ECB Hesitates on Rate Hikes Amid US Jobs Surge

According to Commerzbank, further rate hikes by the European Central Bank (ECB) are possible but unlikely. The ECB's baseline scenario for inflation is expected to continue evolving, and its modest response so far suggests that it will not significantly alter course soon.

The deposit rate at 2.5% starting next week is near the upper end of its neutral range, which may deter monetary policy doves on the ECB Governing Council from supporting further increases. The U.S. economy added jobs at a brisk pace in August, with nonfarm payrolls rising by 162,000.

However, President Donald Trump thinks that lower interest rates are necessary to maintain the United States' strong credit status and competitiveness. He advocates for a rate cut, citing the country's strong economy and its role as a global leader.