ECB to resist calls to lower interest rates, economists’ poll shows

THE European Central Bank will probably resist growing calls for it to slash interest rates next week, although a stalled eurozone economy will force the bank to cut them early next year, a Reuters poll showed.

The escalating debt crisis and new signs that the economy has taken a turn for the worse has prompted some major banks, including JPMorgan, RBS and Credit Agricole, to make high-profile predictions for a rate cut next month.

“The case for a rate cut at the first scheduled opportunity continues to build,” said Ken Wattrett, economist at BNP Paribas, who expects a 25 basis point move next week. “The threat of an adverse feedback loop between the financial sector and the economy requires a circuit breaker — and as soon as possible.”