Deutsche Bank Sees ECB Hiking Policy Rates by 75bps in October

After the biggest rate hike by the European Central Bank (ECB) yesterday, Deutsche Bank said that it expected the central bank to deliver another big move in October.

“It is likely to be another close call in October and we have shifted our view to expect another 75bp hike (previously: 50bp),” Deutsche Bank wrote in its analysis.

The revision came after the German investment bank digested ECB’s chief Christine Lagarde statement saying that interest rates are far away from the appropriate levels for pulling inflation back down to target in a timely fashion.

The chief also noted that the market should anticipate hikes at the next several meetings.


Yesterday, ECB raised its three official interest rates by 75 basis points each on Thursday, the move that was widely expected as the region is running with a 40-year high inflation rate at 9.1% in August of 2022 from 8.9% in July.

Among a 75 basis point hike from the European central bank, its key deposit rate, which provides the effective floor for money-market rates, to 0.75%, while the refinancing rate increased to 1.25% and the overnight lending rate rose to 1.50%.