Deutsche Bank Adjusts ECB Rate Cut Expectations

LONDON (Reuters) – Deutsche Bank on Tuesday announced it now anticipates the European Central Bank (ECB) will cut interest rates again in October. This comes after unexpected falls in inflation across the eurozone in September.

“Following an even deeper dip in September HICP inflation than we were expecting, we are accelerating the next ECB-25 bp (basis point) rate cut from December to October,” stated Deutsche Bank analysts, led by chief economist Mark Wall, in a note on Tuesday.

They further indicated that a 50-bp cut in December might be a close call if current trends in weaker growth and inflation persist. The eurozone-wide data is set to be released at 0900 GMT (1100 CET) and is projected to show a year-on-year inflation drop to 1.8% in September, which is below the ECB’s 2% target.