Danske Bank expects the European Central Bank to remain on hold, but believes there is a risk of interest rate hikes.

Analysts Kirstine Kundby-Nielsen and Jens Peter Sorensen stated in a report that Danske Bank currently maintains their view that the European Central Bank will keep its main policy rate unchanged at 2.00% until the end of 2027. They stated, "We expect the European Central Bank to overlook negative supply shocks, which also bring downward pressure on growth." However, these analysts emphasize that uncertainty remains high and believe that there is an upward bias in policy rate risks. Data from the London Stock Exchange Group shows that current currency market prices reflect expectations of three rate hikes this year.