Interest Rate Cuts Expected in the Eurozone and Canada Amidst Inflation Concerns
As borrowers in the eurozone and Canada brace for interest rate cuts, the European Central Bank (ECB) and the Bank of Canada (BoC) are gearing up to potentially lower their benchmark rates in the upcoming days. The ECB, facing recent drops in inflation, is forecast to set its policy on Thursday, with a 93% chance of rate cuts, likely lowering the rate on its deposit facility to 3.75%. Similarly, the BoC may cut borrowing costs on Wednesday from 5% to 4.75%, as market pricing indicates an 82% chance of a rate cut. This marks a significant shift in policy for both central banks amidst concerns about inflation persisting. While analysts anticipate a total of six rate cuts over the next 18 months between the ECB and BoC, the Bank of England is not expected to follow suit anytime soon, with the first interest rate cut not anticipated until November or December. The future trajectory of interest rates remains uncertain, with various speculations about how central banks will navigate the data flow and inflation dynamics in the coming months. As borrowers await potential relief, the decisions made by these central banks will undoubtedly have a significant impact on the economic landscape of the eurozone and Canada.
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