Two out of three German companies favor ECB rate hike: survey

BERLIN (Reuters) – Nearly two-thirds of German businesses want the European Central Bank to raise interest rates soon despite a clouded growth outlook, a survey showed on Monday.

Market expectations for an ECB interest rate hike have been pushed back into 2020 after a string of disappointing industrial data from Germany and other euro zone economies suggested that growth in the single currency bloc might be slowing.

In a Forsa poll conducted for consultancy firm EY, the DIW economic institute and the DGAP foreign policy think-tank, 62 percent of business managers said they would like the ECB to hike interest rates in the coming years. Some 27 percent said they wanted the ECB to continue its ultra-loose monetary policy.

A majority of German company executives support the euro zone’s bail-out measures for struggling member states, with 83 percent of respondents saying the bloc’s rescue mechanism are good and right, the poll showed.

But 68 percent said Italy’s state debt was a big problem.

Forsa polled senior managers and business executives of 400 companies between Nov. 22 and Jan. 7.

ECB policymakers next meet on Jan. 24 and while no big changes are expected, investors think the bank will tweak its policy message to acknowledge weaker growth.

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