It is expected the European Central Bank will announce another hike in interest rates today.
In a bid to tackle inflation across the eurozone, the bank has increased interest rates nine times since July last year.
Last month, inflation across the eurozone was 5.3% but the bank predicts it will continue to fall this year, as the price of energy drops.
With that in mind, economist Austin Hughes feels a further rate rise is unnecessary.
“There’s been some leaks from ECB sources that suggest there could be a rate rise,” he said.
“I’m still hoping it won’t happen, I don’t think it’s needed.
“This will be the tenth in a row since July 2022 and I think that’s two or three rate hikes too far for the ECB.”
Despite this, Mr Hughes predicted interest rates could soon be slashed quite substantially.
“The ECB always seem to overdo tightening cycles and they’ve always had to reverse course very fast,” he said.
“I don’t think it’s going to be that different this time but they are facing an inflation that is greater than it has been.
“So, it’s understandable that the hawkish wing is still in the ascendent.”
The Central Bank has forecast inflation in Ireland will drop to 3.4% in 2023 and fall to 2.5% in 2025.
The ECB has an inflation target of 2% across all eurozone countries.
Main image: For sale signs. Picture by: Eamonn Farrell/Photocall Ireland