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Nordea expects ECB to keep tightening despite holding its deposit rate

Nordea forecasts the ECB deposit rate will rise to 3.0% by March 2027 through three more 25 basis point hikes.

Reported · Written up by our desk · Central Banks

Nordea strategists Jan von Gerich, Tuuli Koivu, and Anders Svendsen said the European Central Bank kept its deposit rate at 2.25% but signaled that further tightening remains in view.

They continue to forecast three additional 25 basis point increases, with ECB hikes shifting to a quarterly pace that would lift the deposit rate to 3.0% by March 2027, according to FXStreet’s summary of the bank’s view.

Nordea tied the outlook to what they called elevated uncertainty, including energy-driven inflation risks, alongside a resilient Euro-area growth backdrop that could support continued rate increases.

The FXStreet wrap also noted that the ECB decision weighed on the euro, with EUR/USD falling to fresh weekly lows near 1.1380 as market positioning adjusted to the central bank signal.

Latest closeEUR/USD 1.141 ▼0.0%

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