A new Bloomberg survey of analysts shows that the European Central Bank's (ECB) key interest rate is set to fall.
In particular, experts believe it will reach 2.25% by December 2025.
Many agreed that the ECB will cut quarterly until the end of next year, which will bring the adjustment cycle to an end earlier than previously expected. Incidentally, earlier respondents predicted that such a level would not be reached until the second quarter of 2026.
Recall that the ECB began cutting borrowing costs in June 2024 amid growing confidence that inflation would eventually return to its 2% target.
Officials left little doubt that they would continue to make adjustments. However, they declined to give a specific timetable, citing the uncertain global economic situation.
According to recent comments by Yannis Stournaras, governor of the Bank of Greece and a member of the ECB's governing council, two more rate cuts by the European Central Bank are possible in 2024.
I still expect two rate cuts this year if deflation continues as expected. We are on the right track. Growth is weaker than expected, which is also an argument for rate cuts," said Platou Stournaras.