Citing three sources, ECB policy officials expect to raise interest rates by 25 basis points on December 17, raising deposit interest rates from 2.50% to 2.75%. Unless energy prices drop drastically, this rate hike is almost a foregone conclusion. However, officials expect further policy tightening to stop after interest rate hikes, as higher bond yields could reduce Eurozone economic growth by 1 percentage point and inflation by 0.9 percentage points between 2027 and 2028.

Citing three sources, ECB policy officials expect to raise interest rates by 25 basis points on December 17, raising deposit interest rates from 2.50% to 2.75%. Unless energy prices drop drastically, this rate hike is almost a foregone conclusion. However, officials expect further policy tightening to stop after interest rate hikes, as higher bond yields could reduce Eurozone economic growth by 1 percentage point and inflation by 0.9 percentage points between 2027 and 2028.