ECB expected to pause tightening

The European Central Bank may pause its interest rate hike cycle today. The decision will be announced at 15:15 Turkish time. The European Central Bank may pause its interest rate hike cycle today, which it has been continuing for more than a year. The expectation of 59 analysts who participated in the Bloomberg survey is that the deposit rate will remain unchanged at 4 percent. Indicators that growth has recently slowed in the 20-country Eurozone and the continuation of the softening trend in inflation strengthen the expectations that interest rates will remain unchanged. ECB members have recently given the message that borrowing costs will remain high for a long time in order to return to the 2 percent inflation target. Although the conflicts in the Middle East pose a risk of increasing energy prices, recession is seen as a more imminent threat for the Eurozone. Markets are pricing in the possibility that the ECB may cut interest rates before the fall months of next year. According to Bloomberg Economics Economist David Powell, it is almost certain that the deposit rate will be kept at 4 percent at this meeting. Powell expects the ECB to give verbal guidance that it will keep interest rates at current levels in the first half of next year. Following the decision, which will be announced at 15:15 Turkish time, ECB President Christine Lagarde will hold a press conference in Athens at 15:45.