Prior to the interest rate announcement, the market is speculating on whether there could be a so-called double increase of 50 basis points (0.50 percentage points).

In its so-called repo rate path from 9 June, the Executive Board of the ECB has outlined an increase of 25 basis points, which is also the average forecast among analysts prior to the announcement.

However, in the market pricing, the probability of a double increase from the ECB is almost 40 percent, reports the news agency Bloomberg.

According to Bloomberg's sources, the issue of a double increase will also be discussed in the Executive Board before the decision.

Speculation about the rate hike has picked up since inflation in the eurozone was measured at a record high of 8.6 per cent, which is more than four times higher than the ECB's inflation target of 2 per cent.

And as recently as 28 June, ECB Governor Christine Lagarde opened in a speech to move harder than planned.

The pressure on the ECB to raise interest rates is also gaining momentum from the fact that ahead of the next interest rate announcement from the US Federal Reserve (Fed) next week, discussions have begun on whether it is not time for an increase of as much as 100 basis points.

Important for trust

The ECB is also expected to clarify how to counter the so-called fragmentation of the eurozone fixed income market, a problem highlighted by rising Italian interest rates as a result of uncertainty over Prime Minister Mario Draghi's future.

Specifically, it is assumed to land in some form of aid buying tool, which will even out the interest rate differentials in the eurozone.

"This is important for the markets' confidence in the ECB to remain strong and for Italian interest rates not to rise sharply again.

We expect the new instrument to be implemented in a flexible way, with a focus on shorter maturities, but without a predetermined intervention amount or time frame ", writes Danske Bank's global head of research Heidi Schauman to TT in a comment.

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The Governor of the Riksbank, Stefan Ingves, holds a press conference following the interest rate announcement to raise the policy rate by 0.5 percentage points, from 0.25 to 0.75 per cent.