Analysts surveyed expect the European Central Bank to cut interest rates two more times this year and no longer expect the bank's rate to fall below 2 percent, the agency survey showed. The monthly survey showed the ECB could still cut interest rates back-to-back in April and June, after six cuts so far. But unlike the previous round of surveys, respondents expected the deposit rate, currently 2.5 percent, to remain at 2 percent until the end of the survey period. And in mid-February, a slim majority had expected an eventual cut to 1.75 percent in March 2026. European governments plan to sharply increase defense investment, which could boost flagging economic growth and fuel inflation.
In addition to military spending, Germany intends to spend hundreds of billions of euros more to revamp its ageing infrastructure, spending that "will add to inflationary pressures by the end of 2026", said Marco Wagner, economist at Commerzbank.
Analysts predict that the European Central Bank will pause after cutting interest rates twice this year
2025-03-17 05:48:31
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