By Marta Vilar – MADRID (Econostream) - Economists broadly expect this week's European Central Bank rate increase to mark the end of the current hiking cycle, with 2.50% remaining the dominant deposit rate forecast through the end of 2027, according to the latest Econostream ECB Survey.

All 24 economists participating in the survey expect the Governing Council to raise the deposit facility rate by 25bp to 2.50% on Thursday, with 21 assigning a probability of more than 85% to their base case.

The expectation that September will mark the end of the hiking cycle comes despite economists anticipating a higher inflation outlook, with the median respondent expecting the ECB to raise its 2027 headline inflation projection by 0.2 percentage points to 2.5%.

2.50% Dominates Rate Outlook

Most respondents expect the deposit rate to remain at 2.50% beyond September, with that level the dominant forecast at the end of 2026, end-H1 2027 and end-2027.

Among those expecting 2.50% at end-2027, 58% see risks to their forecast as balanced, while 42% see them skewed towards higher rates.

2027 Inflation Seen Revised Higher

Economists expect the ECB to raise its 2027 headline inflation projection by 0.2 percentage points to 2.5%, while leaving its 2026 and 2028 forecasts unchanged at 3.0% and 2.0%, respectively.

Core inflation forecasts are expected to remain unchanged from June, at 2.5% in 2026 and 2027 and 2.2% in 2028.
The growth outlook is slightly stronger than in the previous projection round, with GDP growth seen 0.1 percentage point higher than in June at 0.9% in 2026 and 1.3% in 2027, and unchanged at 1.5% in 2028.

The inflation outlook was the most commonly cited reason for the expected September hike, selected by 15 of 24 respondents.

Lagarde Seen Retaining Mild Tightening Bias

Beyond September, Lagarde is expected to retain some tightening bias, with 58% seeing her stressing the ECB's readiness to hike again if needed and 38% expecting no clear directional bias.

Views on her overall tone are almost evenly split, with 54% expecting it to remain broadly unchanged and 42% expecting it to become more hawkish.

Little Clarity Expected on Lagarde's Future

Little new information is expected on Lagarde's future, with 19 of 22 respondents seeing her repeating her previous position without giving a specific departure date. None expect her to explicitly confirm she will serve her full term.

The complete results, including all survey questions and charts, are available in the Econostream ECB Survey – September 2026 Report.