ECB unlikely to cut deposit rate in next six months: Traders

The European Central Bank is unlikely to cut its deposit rate further in the next six months, even though inflation expectations have nosedived, according to a slim majority of euro money market traders in a Reuters poll.

Fourteen of 25 traders polled on Monday do not expect the ECB to repeat the 10 basis points shave it made in December. The remaining 11 trader said it would.

Currently sitting at -0.3 percent, the negative deposit rate effectively means banks have to pay the ECB to park money overnight.

Expectations for inflation have plunged as oil prices have fallen further and are not expected to rise anytime soon, according to a separate Reuters poll last week.

The regular survey showed banks will take 65 billion euros ($70.8 billion) from the ECB at its weekly refinancing operation, similar to the 65.74 billion euros maturing from last week.

Forecasts ranged from 60 billion to 75 billion euros.

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