Traders increase bets on the European Central Bank cutting interest rates this year

Traders have increased their bets on the European Central Bank to cut interest rates this year after policymakers lowered their inflation forecasts. Money markets expect four 25 basis point interest rate cuts by the end of the year, with the first cut by June. Before the meeting, people were betting that there would be three interest rate cuts this year. The latest development ends a recent repricing of smaller interest rate cuts by major central banks.