Bloomberg: ECB Rate Cuts Expected by December

According to a Bloomberg survey, the European Central Bank (ECB) is expected to proceed with its next, and likely final, rate cut in December. Economists have shifted their forecasts by three months compared to the previous estimate in July.

The survey indicates that the deposit rate is expected to remain at 1.75% for nine to ten months. The central bank is maintaining a wait-and-see approach, assessing the impact of US President Donald Trump's trade tariffs on the Eurozone economy.

By December, policymakers will have a complete picture of the economy's performance in the third quarter, and new forecasts will provide indications of growth and inflation through 2028. The US Federal Reserve (Fed) is also taking a similar stance.

The ECB kept interest rates unchanged last month, believing there is no immediate need for further cuts. Markets have reduced expectations for a September cut, estimating a little over a 50% chance of a 25 basis point reduction by the end of the year.

Analysts warn that if there is no move in December, financial markets may interpret the decision as an indication that the ECB has completed its cycle of cuts.