A recent Reuters poll indicates a notable shift in economists' expectations regarding the European Central Bank's (ECB) monetary policy trajectory. Out of 85 economists surveyed, 84 anticipate that the ECB will keep its deposit rate unchanged at 2% during the April meeting, reflecting an almost unanimous consensus for a near-term pause in policy adjustments [1]. However, sentiment is evolving for the subsequent meetings, with 44 of the 85 economists now forecasting a rate hike to 2.25% as early as June [1]. This marks a significant change from late March, when 38 out of 60 economists expected no change in rates through 2026 [1].
The poll further reveals that expectations for tighter policy are strengthening over the medium term. Specifically, 50 out of 85 economists now expect at least one rate hike this year, compared to just 21 out of 60 in the previous survey [1]. This shift underscores growing concerns about persistent inflationary pressures in the Eurozone and suggests that the ECB may adopt a more restrictive stance if such pressures continue [1].
The survey results highlight ongoing uncertainty regarding the inflation outlook in the Eurozone. While the ECB is expected to remain cautious in the near term, the central bank appears to be keeping its options open for further policy tightening should inflation remain elevated [1].
No immediate market reaction or analyst opinions beyond the poll results are discussed in the article. The focus remains on the evolving consensus among economists and the potential implications for future ECB policy decisions [1].
CONCLUSION
Economists are increasingly expecting the ECB to hold rates steady in April but are shifting toward the likelihood of a rate hike as soon as June. This change in consensus reflects heightened concerns about inflation and signals that the ECB may pursue a more restrictive policy stance if inflationary pressures persist.