LONDON (Reuters) - Investors in money markets expect the European Central Bank to cut interest rates by September in efforts to safeguard the bloc from any economic shock resulting from Britain's vote to leave the EU on Friday.
Forward Eonia bank-to-bank lending rates dated for the Sept. 8 meeting fell to around minus 0.44 percent, some 10 basis points below the overnight rate of minus 0.34 percent.
This suggests markets anticipate a 10 basis point cut to the ECB's deposit rate by the end of the year. The forward rates give around a 60 percent chance of a cut at the ECB's next meeting on July 21.