Skip to main content

Deposit rate still on track for 4% peak

While it is not a done deal, we think the ECB is most likely to raise its deposit rate by 50bp next week. Economic activity has been more resilient and core inflation higher than the ECB anticipated so far this year, and the banking sector turbulence seems to have blown over without much impact on credit conditions. With the labour market still remarkably tight – and possibly getting tighter – the ECB is likely to raise rates further after next week. We forecast the deposit rate to peak at 4% and expect the Bank to step up the pace of QT from July.  

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services

Get access