Barclays, BofA see no further ECB easing in 2025

Major banks drop forecasts for a December rate cut after the ECB keeps borrowing costs steady and signals policy stability.

Leading investment banks Barclays and Bank of America no longer expect the European Central Bank (ECB) to cut interest rates in December, after the bank held rates steady at 2% for a third consecutive meeting on Thursday. The ECB said its policy stance remains in a “good place” as economic risks ease and the eurozone shows continued resilience.

Barclays and BofA had previously forecast a 25-basis-point cut next month. Barclays now expects interest rates to remain unchanged through the end of 2026, while BofA anticipates its first cut in March 2026. Other major institutions, including Goldman Sachs and UBS Global Wealth Management, also expect the ECB to stay on hold, with market pricing signalling little to no chance of easing in December.