ECB Set to Hike Interest Rates as Iran War Flares Anew
The increase, the second since June, will raise borrowing costs and affect cash savings and investments, analysts said.
- On Thursday, the ECB will conclude a two-day meeting, with officials expected to confirm an interest rate increase from 2.25% to 2.5%.
- Inflation across the Eurozone climbed to 3.3%, up from 2.9% in July, as energy costs surged 14.3% compared to last year, driving the hike.
- Market confidence is high, with 99.2% of bets on Polymarket predicting a 0.25% rise; Irish banks have held rates steady so far but shifts are likely soon.
- Variable interest rates currently sit around 0.75% higher than fixed offers, meaning homeowners could save €26,000 by switching from AIB's variable rate to 3.1% fixed.
- Better options are available for savers earning 0.01% in demand deposits, as the 2.5% ECB rate offers improved returns compared to low-interest accounts.
37 Articles
37 Articles
The European Central Bank is expected to raise its interest rates next Thursday following the rise in energy prices due to tensions in the Middle East. Inflation reached 3.3% in August in the euro area, its highest level in three years. It is the second rate increase in the year after June.
The European Central Bank (ECB) is expected to raise interest rates again this week after renewed struggles in the Middle East, leading to renewed energy prices and the threat of a further acceleration in inflation.
The possibility that the agency will apply an additional increase at the December meeting begins to gain strength in the market, which actually takes for granted the increase in the price of money to 2.5% this Thursday.
ECB set to hike interest rates as Iran war flares anew
Some of the heaviest clashes in weeks in the US-Iran war erupted in recent days, sending oil prices soaring and dimming hopes that energy flows through the Strait of Hormuz will return to normal anytime soon. Inflation in the 21-nation eurozone, which is heavily dependent on energy imports, hit a three-year high of 3.3 percent in August, substantially above the ECB's two-percent target. And with fears growing prices will spiral even higher, the …
With the impasse in the US-Iran conflict continuing and fuel prices moving sharply upwards, the European Central Bank is expected to raise its main deposit rate by 25 basis points to 2.5% next Thursday. It will be the second increase this year, after the corresponding one that took place in June. Such a development has been discounted by the market, as can be seen from the course of the Euribor - three-month and one-month - on the basis of which…
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