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Allspring expects ECB to lift rates; dovish tone limited

Allspring Global Investments expects the ECB to raise interest rates on Thursday, in line with market pricing, but says the ECB’s ability to sound dovish is limited.

Allspring Global Investments expects the European Central Bank to raise interest rates by 25 basis points on Thursday, in line with market pricing, while its room to sound dovish remains limited. Allspring said eurozone core inflation is likely to stay elevated in the coming months because of base effects.