Lagarde hinted that the interest rate cut cycle is coming to an end, and the market is no longer fully pricing in another 25 basis points rate cut within the year.

Traders have reduced their bets on future rate cuts by the European Central Bank and are no longer fully pricing in expectations of another 25 basis point cut this year. The market's expectation for further rate cuts before December was only 23 basis points at one point, compared to 32 basis points before the ECB's rate decision on Thursday. Short-term bonds led the decline, with the yield on two-year German government bonds rising by 7 basis points to 1.87%. Earlier, ECB President Lagarde stated that the central bank's rate cut cycle is nearing its end.