What’s next for interest rates in Ireland?

The European Central Bank (ECB) has cut interest rates eight times since June 2024, and the main deposit rate currently sits at 2%.

Read on to discover if and when interest rates are likely to increase or decrease again, and what this could mean for savings accounts.

The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.

Interest rates play a key role in how your savings grow over time. Whether you're comparing fixed or variable rate accounts, understanding how interest is calculated — and what influences it — can help you make smarter financial decisions.

Learn more in our guide to interest rates, or dive deeper into how ECB rates impact your savings.

In Ireland, the annual Harmonised Index of Consumer Prices (HICP) rose to 2.7% in September. The Consumer Price Index (CPI) also rose to 2.7% in September, up from an annual increase of 2% in the 12 months to August 2025.

On 30 October 2025, the European Central Bank kept its deposit rate at 2%, citing steady inflation and modest euro-area growth. For Irish savers, this means local banks are unlikely to raise deposit rates further in the short term, keeping savings returns broadly stable.

Over the past year, the ECB has shifted from tightening to easing monetary policy. In June 2024, it made its first rate cut of the cycle, lowering the deposit rate from 4% to 3.75%, followed by further reductions through early 2025. By June 2025, the deposit rate stood at 2%, where it has remained since. The cuts reflect easing inflation pressures and slower euro-area growth, with the ECB now maintaining a steady stance as it gauges the balance between price stability and economic resilience.

According to new figures from the Central Bank of Ireland, the average rate on new Irish mortgage agreements at end-July 2025 was 3.58%, down 2 basis points from July.

Irish mortgage rates are the eighth highest in the eurozone, where the average rate is 3.30%.

Following its most recent decision, the ECB said monetary policy is “in a good place” and will remain data-dependent and decided on a meeting-by-meeting basis. This signals a pause rather than a shift, with no preset path for rate cuts or hikes. For Ireland, where interest rates move in line with ECB policy, this means borrowing and savings rates are likely to stay broadly stable in the coming months, with any future changes depending on euro-area inflation and growth trends rather than domestic factors.

Here are some things for Irish savers to consider in the current interest rate environment:

• It's important to note that interest rates can vary depending on the lender, and the type of savings account.
• Shop around for the best savings interest rates. You can use a comparison website to compare the interest rates offered by different Irish banks.
• Consider exploring a fixed term savings account. Fixed term savings accounts typically offer higher interest rates than demand deposit accounts, but you will not be able to access your money during the fixed term.
• Check that your savings account is covered by the national deposit guarantee scheme of the country where the bank is headquartered.

So, what's the best savings account for you? This will depend on various factors, for example the amount you have to save, and whether you’ll need access to your money. If you can afford to lock your money away for a set period, a fixed interest rate account may offer more competitive returns. This type of savings account is often chosen for long-term savings goals.

Public Expenditure Minister, Paschal Donohoe, has said:

“Looking to put money in other parts of Europe, and other banks elsewhere in Europe, is not an unpatriotic act. It’s the way the single market functions.”

Regardless of what happens to interest rates in Ireland, building up your savings can help you stay prepared for unexpected expenses. Whether it’s to take advantage of competitive interest rates whilst they're still around, or to protect yourself and your family, opening a savings account can help you get more from your money.

To compare savings accounts from 25+ trusted European banks, register for a free Raisin Account today.