European Central Bank (ECB) Executive Board member Isabel Schnabel emphasized the need for the ECB to maintain a steady hand and keep interest rates close to current levels, describing the policy stance as firmly in neutral territory. She highlighted inflation risks skewed to the upside due to fiscal expansion and tariffs. Following her remarks and recent US-China talks, market participants have reduced expectations for ECB rate cuts, now pricing in less than 50 basis points of reductions by the end of 2025, with the deposit rate expected to be around 1.75% by year-end, up from 1.67% previously. Similarly, traders have trimmed bets on the Bank of England (BoE), anticipating less than 50 basis points of cuts by year-end. In the United States, futures markets show a diminished expectation for Federal Reserve rate cuts, with Fed funds futures now pricing in a 56 basis point easing by December, down from approximately 75 basis points just days earlier and 110 basis points in mid-April. This suggests that market sentiment is shifting towards a more cautious outlook on monetary easing across major central banks.