MarsBit: 83% of Economists Predict ECB to Raise Rates in September

Huoxing Finance reports that on August 13, according to foreign media, 83% of economists expect the European Central Bank to raise the deposit facility rate by 25 basis points to 2.50% in September; 80% expect the deposit facility rate to remain at 2.50% by year-end; and 63% expect it to stay at least at 2.50% until the third quarter of 2027. Of the 69 economists surveyed, 57 (approximately 83%) anticipate a rate hike next month, up from 72% before the July meeting and 65% in June. This indicates that consensus among markets for another ECB rate hike in September is strengthening following the June increase. Nomura Securities noted: “The longer and higher oil prices remain at current levels, the greater the risk of second-round effects. The ECB cannot act until it sees these effects, but it can act preemptively—which is precisely what the ECB has been doing. The risk is that if the ECB raises rates only once, it may appear as a mere tweak, and monetary policy is well known not to operate that way. If they hike once, they are likely to hike again. Given that the June hike was an obvious choice for the ECB, we believe the likelihood of another hike is high.” (Jin10)