MILAN - Goldman Sachs expects the European Central Bank to raise interest rates by 75 basis points at its policy meeting next week after data on Wednesday showed euro zone inflation hitting a new record high.
"Given today's stronger-than-expected inflation data -together with hawkish commentary and upside risks to near-term growth - we now expect the Governing Council to hike by 75bp at the September meeting," the U.S. bank said in a note on Wednesday.
The bank's economists also raised where they expect rates to peak, to 1.75% in February 2023, from 1.50% previously.
Markets have ramped up bets on such a move since last Friday, when some sources told Reuters policymakers could discuss a 75 basis-point move, and hawkish policymaker commentary at the Jackson Hole symposium.
Other banks including Nordea and Danske Bank have also said they expect a 75 basis-point hike.
