(Bloomberg) — The slid and bonds rallied as traders pared bets on longer-term interest-rate hikes after the European Central Bank up by a jumbo 75 basis points for a second consecutive meeting.

The euro fell as much as 0.9% to briefly drop below parity after the decision, which brings the deposit rate to 1.5%. Markets had been expecting a hike of that magnitude for weeks as policy makers attempt to bring record inflation under control.

While the ECB said that it expects to raise interest rates further, it adopted a slightly less hawkish tone. That led money markets to cut rate-hike wagers by as much as 20 basis points, pricing a peak below 2.75% next year. That compares with above 3.25% seen as recently as last week.

“The doves today have won some flexibility in forward guidance,” said Nomura Inc. currency strategist Jordan Rochester. “It’s not just an inflation story anymore. Combine this with the BOC yesterday and it’s looking more and more like a global central bank pivot.”

The Bank of Canada hiked rates by 50 basis points on Wednesday, a smaller-than-expected move. 

Traders’ attention is now turning to ECB President Christine Lagarde’s press conference, and in particular any indication of whether policy makers may deliver a smaller hike in December. 

German bonds swung to gains across the board. The note  — among the most sensitive to interest-rate changes — led the rally, sending the yield as much as eight basis points lower to 1.86%. It had risen as much as 11 basis points earlier.