Barclays currently believes that the European Central Bank may choose to cut interest rates once in December, rather than the previously predicted September cut. The bank's economist Mariano Sinna said this revision takes into account the weakness in economic activity in the second half of the year, caused by the ongoing drag of trade policies and the effects of earlier imports from the United States. Barclays expects that by December, signals regarding trade headwinds will become clearer, and concerns about the impact of supply chain disruptions on inflation will also diminish. Furthermore, confidence that the 2026 fiscal plan will not reignite inflationary pressures may strengthen, supporting a 25 basis point rate cut. Barclays expects that by 2026, the ECB's terminal deposit rate will remain at 1.75%. (Jin Shi)
