UBS Forecasts ECB Rate Cuts in 2027

Eurozone CPI rose to 3.2% in May, core inflation 2.5%, prompting expectations of ECB rate hikes in June and July 2026.
UBS projects Eurozone GDP contraction of 0.1‑0.2% in Q2 and overall growth of 0.8% in 2026, down from 1.3% earlier.
UBS expects ECB to cut rates in 2027 after inflation shock fades, citing energy‑driven price surge and weakening economic activity.
Eurozone composite PMI fell to 47.5 in May, indicating sharpest private‑sector contraction since Oct 2023.