Stephen Hamilton: ECB interest rates unlikely to decrease before 2025

As savings interest rates increase in the months ahead, we should also see a corresponding increase in mortgage variable and fixed interest rates, writes managing director of MortgageLine.ie Stephen Hamilton.

President of the ECB Christine Lagarde is set to raise interest rates by a further 0.25% next week. 

It is pretty much a given that the European Central Bank (ECB) will increase interest rates again this week by at least another 0.25%. However, has the ECB reached a peak or will rates rise further still?

In his recent interview with Bloomberg, Dutch economist and ECB governing council member Klass Knot hinted that we may be close to the end of interest rate hikes. He commented that inflation has “plateaued” and any action from the ECB beyond July is “a possibility but by no means a certainty.” European inflation has almost halved since its peak of 10.6% in October 2022. This would lead you to believe that inflation is under control and in turn this would suggest that we are coming to the end of interest rate increases. But it is not as simple as that, unfortunately.