European Central Bank expected to raise rates twice as inflation climbs toward 3%

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The European Central Bank is gearing up to hike interest rates twice this year, a move that would mark a sharp reversal from the easing trajectory markets had grown comfortable with. A Bloomberg economist survey conducted between May 4-7, 2026, shows the consensus now expects 25 basis point increases in both June and September, lifting the deposit facility rate from 2.00% to 2.50%.

That’s not what most forecasters were calling for just weeks ago. Earlier predictions had penciled in only a single hike for the year. But surging energy prices, driven by ongoing conflict in Iran, have pushed euro-area inflation to an estimated 2.9% to 3%, well above the ECB’s 2% target.