Analysts expect ECB to pause after two rate cuts this year

According to Mars Finance news, a survey by institutions shows that the surveyed analysts expect the European Central Bank to cut interest rates twice more this year, and no longer expect the bank's interest rates to fall below 2%. The monthly survey shows that after six rate cuts so far, the European Central Bank may still cut rates consecutively in April and June. But unlike the previous survey, the respondents expect the deposit rate (currently 2.5%) to remain at 2% before the end of the survey period. In mid-February, a slim majority had expected the rate to ultimately be cut to 1.75% by March 2026. Governments across Europe are planning to significantly increase defense investment, which could boost the sluggish economic growth and exacerbate inflation. In addition to military spending, Germany also plans to add tens of billions of euros in additional spending to overhaul its aging infrastructure. Deutsche Bank economist Marco Wagner said these expenditures "will increase inflationary pressures by the end of 2026".