Traders Boost ECB, BOE Rate-Hike Bets as Energy Prices Soar

Traders amped up bets on interest-rate hikes from the European Central Bank and the Bank of England as soaring energy prices fueled fears of an inflation spike.

Swaps imply around a 70% probability of two 25-basis-point rate increases by the ECB this year, compared with the one move that was priced on Friday. A first rate hike is fully priced by July. Meanwhile, money markets now see a roughly 50% chance of a BOE rate increase by year-end, reversing rate-cut bets that were in place last week.