FRANKFURT: The European Central Bank (ECB) will raise interest rates twice this year as the Iran war drives inflation higher, a Bloomberg survey shows.
Economists see quarter-point hikes in both June and September, aligning more closely with market expectations for at least two moves this year, according to the May 4 to 7 poll.
The last round only envisaged one increase in the deposit rate, which is currently at 2%.
Inflation, meanwhile, is predicted to quicken to 2.9% this year from 2.8% in the last survey.
Analysts expect it to ease to 2.1% in 2027 and meet the ECB’s 2% goal in 2028.
ECB officials have held fire on hikes so far as they assess the economic damage caused by the conflict in the Middle East. — Bloomberg
