David McNamara: Central banks globally deliver an early Christmas present

Majority of central banks have opted for interest rate cuts in their pre-Christmas meetings

The market expects the ECB will continue to ease policy in 2025.

With a flurry of central bank meetings occurring in the two weeks before the Christmas break, the majority have been opting for further rate cuts. Most pertinently for the Irish economy, the ECB delivered an expected 25 basis point (bps) cut, accompanied by a dovish tilt in its meeting statement. 

This leaves the deposit rate at 3% and the re-finance rate at 3.15%. In particular, the statement dropped the reference to keeping policy “sufficiently restrictive”, indicating a more dovish bias on the ECB Governing Council.