We expect ongoing economic weakness to increasingly test the resilience of the labor market and firms’ pricing power, which in spring should bring about the slowdown in wages and mark-ups the GC needs to see to reassess risks to price stability in a more favorable direction. That should open the door to rate cuts, probably starting in June at a pace of 25bp per quarter. While risks have tilted towards earlier and deeper cuts, the current market pricing remains too aggressive in our view.