LIVE MARKETS-ECB on hold not a done deal

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ECB ON HOLD NOT A DONE DEAL

European Central Bank policymakers were in no hurry to cut rates when they met last month and left interest rates unchanged.

This solidified confidence among investors that no further rate cut was coming this year and markets now see just a one-in-three chance of more easing in 2026.

But digging deeper, ING analysts, looking into the ECB minutes, said it appears that the door to rate cuts is not closed, yet.

"While most members seem to agree that downside risks have eased slightly, the minutes reveal a lively discussion on inflation risks, with views becoming increasingly divergent," they say.

For the December meeting the central bank's projections will be now more crucial than ever in deciding whether or not to keep interest rates on hold, ING say.

In September, the ECB projected inflation at 1.7% in 2026 and 1.9% in 2027. But "if projections fall below 1.7% for both 2026 and 2027, the likelihood of another rate cut would definitely increase".

(Joice Alves)

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