LONDON (Reuters) – Deutsche Bank has raised its forecasts for where U.S. interest rates will end up, as latest inflation numbers suggested the Federal Reserve would need to tighten monetary policy further.
The bank said it had now increased its U.S. terminal rate forecast to 5.6% from 5.1%, with two extra 25 basis point rate hikes anticipated in June and July.
Data on Tuesday showed U.S consumer prices accelerated in January, pushing two year Treasury yields to their highest since November as investors braced for inflation proving stickier than hoped.
(Reporting by Dhara Ranasinghe; editing by Sam Indyk)