ECB: Another interest rate hike in the coming months is becoming increasingly unlikely – Commerzbank

The signs of a recession in the Euro area are growing. Therefore, economists at Commerzbank do not expect the ECB to raise rates in the coming months.

Economy in a recession

The Purchasing Managers' Index for the service sector, the most reliable economic barometer for the Euro area, fell again in October by 0.9 points to 47.8. It has thus been clearly in recession territory for three months. The index for the manufacturing sector, at 43.0, also gives no hope of a turnaround.

The ECB is likely to revise its economic outlook further downwards. In its September projections, it still assumed that the Euro area economy would avoid a recession. A further increase in the key interest rate is thus becoming increasingly unlikely.