(Bloomberg) -- Traders reduced bets on European Central Bank interest-rate cuts this year to fewer than one percentage point, the lowest wager for months.

Swap contracts show less than four 25 basis-point cuts are priced through the end of 2024, down from as many as seven at the end of last year. Money markets also trimmed the chances of a first move in April to only 30%, with the first reduction expected in June. The reassessment led the euro to jump.

The moves came after French services and manufacturing data beat economists’ expectations, the latest sign of economic resilience that’s forced investors to reconsider the amount of easing major central banks stand to deliver. Figures for the euro zone hit an eight-month high, with the services index back at 50, ending six months of contraction.

The market bets on cuts have also likely been influenced by the US economy’s strength, which has led traders to reassess the extent of easing that the Federal Reserve can deliver this year. Another round of strong US inflation data could cause the Fed to delay, said Jane Foley, head of FX strategy at Rabobank.

“To avoid a drop in the euro-dollar exchange rate, this also suggests a likely delay in ECB policy changes,” she said.

The prospect of less easing led the common currency to jump as much as 0.6% to 1.0888, the highest since Feb. 2, before it slipped back to around 1.0850 after data showed a manufacturing downturn unexpectedly deepened in Germany. Traders also drove up the German 10-year bond yield by as much as six basis points to 2.51%, a new high for this year, before paring the move.

Read more: Euro Zone Overcomes German Factory Weakness as Downturn Eases

Germany increasingly looks like it’s acting as a brake on the broader region. Its government on Wednesday slashed its growth forecast for this year to just 0.2%, after a contraction in 2023. ECB policymakers in recent days have urged caution to avoid adjusting policy prematurely, echoing a view seen in the minutes of the Fed’s latest gathering.

“We are in the midst of a ‘2024 rate cuts reassessment’ in the G3 economies,” said Evelyne Gomez-Liechti, a strategist at Mizuho International, seeing the downsizing of ECB rate bets as a “sensible” move. “Three 25 basis-point cuts is our base case for the ECB and we think they will only cut gradually as labor markets continue to be resilient.”

--With assistance from Alice Atkins and Anchalee Worrachate.

(Updates pricing throughout, adds additional comments.)

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