Nordea Forecasts ECB Deposit Rate Peak at 3% as June Hiking Cycle Starts

Markets have fully priced the ECB's first 25bp deposit-rate hike to 2.25% on 11 June, marking the start of a new tightening cycle. Hawkish interventions from Schnabel, Lane, Wunsch and Nagel throughout May, citing persistent Iran-related energy shocks and second-round inflation risks, drove the shift despite weak PMIs and stagflation signals. Latest forecasts from Danske Bank and Nordea confirm the move and project further hikes extending the peak rate to 3%, while Nomura frames the June action as a data-dependent recalibration rather than aggressive tightening. EURUSD has consolidated above 1.1650 amid the repricing.