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Divergence watch: ECB decision and central banks’ policy paths

Goldman Sachs The Markets

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Analysis of inflation risks and their impact on ECB policy decisions

The chapter explores the uncertainties around inflation data, emphasizing the risks of potential upside surprises impacting interest rates, with a focus on services inflation and its relationship to consumer behavior like spending on tourism and events. Consumer sentiment towards European destinations and live events is discussed as potential drivers of heightened services inflation, raising questions about the lasting effects.

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