ECB expected to raise rates to two decade high of 3.5 later
Fed signals two more rate hikes before end of year
China cuts another key lending rate
Yen takes a tumble ahead of Friday BoJ meeting

LONDON, June 15 Reuters World stocks slipped from 18month peaks and the dollar pushed higher on Thursday as traders readied for what is expected to be the eighth straight rate hike from the European Central Bank ECB later.

Europe39;s groggy start came after Wednesday39;s first pause in the U.S. Federal Reserve39;s rapid hiking cycle in over a year was offset by an unexpected signal from the bank39;s policymakers that another two rises could still come this year.

Dealers reacted by pushing both U.S. and German 2year bond yields , which drive global borrowing costs, to their highest levels since March at 4.8 and 3.1 respectively.

London, Paris and Frankfurt bluechips dipped by around 0.2 , while the dollar clambered off a 4week low against the other major world currencies as Japan39;s yen took a tumble ahead of a central bank meeting there on Friday.

I expect the ECB will raise rates 25 bps basis points and end the reinvestment by the COVID era asset purchase programme in July, said Bill Campbell, a portfolio manager at DoubleLine Capital.

ECB President Christine Lagarde39;s press conference, meanwhile, will focus on sticky core inflation which will keep an additional hike in July on the table and mean another is possible in September if financial conditions don39;t…