Citigroup now expect the ECB to cut either 75bp or 100bp in December and further cuts in 2009, writes Citi economist Jurgen Michels. The report cites the latest monthly ECB bulletin in combination
with negative economic news (e.g. larger than expected fall in 3Q German GDP and downward revision of the growth and inflation forecasts by the IMF and the OECD). Citi were previously looking for ECB to cut again by at least 50bp in December.