Markets bet ECB could cut interest rates as early as March

Irish fixed-rate mortgage holders may benefit from lower-than-anticipated rates well before any official cut from the ECB  

Leading mortgage adviser Michael Dowling: Irish banks will have the room to cut fixed rates before any ECB rate cut.

As many as 70,000 households whose current fixed mortgage rates expire into 2024 will likely face much lower-than-anticipated hikes in their interest bills, as wholesale market funding rates continued to tumble on Thursday, amid expectations the European Central Bank (ECB) could be forced to cut official rates as early as March. 

Financial markets now bet the ECB will in all likelihood start cutting in April, and they see an almost 50% chance of a reduction as early as March, when just over a month ago, the expectation was for a first reduction in June. Pressure is building on the ECB as inflation tumbles and key eurozone economies such as Germany and France flirt with recession. Markets are also predicting that the ECB will cut more often and more deeply through next year.