A survey shows that economists expect the European Central Bank not to cut interest rates before September 2024, indicating that signals from policymakers that rate cuts will not come soon are gradually being accepted. Unlike the previous round of surveys, respondents at the time still believed that the European Central Bank would cut interest rates in March next year and another rate cut in October next year.
The latest survey results are consistent with the statements made by European Central Bank officials in recent days. Martins Kazaks, a member of the European Central Bank's management committee, said that the current economic forecast is inconsistent with the interest rate cut in the first half of 2024. "We will wait and see in the second half of next year
The Governor of the Slovenian Central Bank, Bostjan Vasle, stated that the increase in bond yields indicates that more and more investors believe that "interest rates will remain at a higher level for a longer period of time" to bring inflation back to the target of 2%.
The market expects the European Central Bank to maintain high interest rates for an extended period of time
Respondents still believe that price increases will slow down to 2.7% next year and 2.1% in 2025. However, economic growth will be lower than previously expected. According to the survey, respondents believe that after a growth rate of 0.5% in 2023, the economic growth rate next year will only be 0.7%.