A reduction in euro interest rates from the current 3 per cent repo rate to 2.8 per cent is not likely before late spring because of the weak economic outlook for the euro zone, according to ICC Bank.

Writing in ICC's Treasury Insight bulletin, Ms Mary Doyle, manager of business development and group marketing, says many continental economies are less buoyant than Ireland's, pointing to a modest euro interest rate reduction in late spring.

The European Central Bank is likely to wait until then before responding too speedily to political pressures, she says.