European interest rates may fall next week, economists hope.

With substantial rate cuts in place in the U.S., including another 25 basis points this week, an increase in liquidity by the Bank of Japan, and solid rate cuts from the Bank of Canada, economists are clamouring for cuts in Europe.

Rate cutting by the European Central Bank is seen as an essential component for a global economic turnaround — supporting growth in that region, and helping the recovery in the U.S., and therefore around the world.

CIBC World Markets’ European Economics group says that recent reports of light European inflation, weak growth, and the strength of the euro, “set an ideal background for the European Central Bank to deliver what has become a highly necessary rate cut” at the ECB’s meeting on Thursday. CIBC suggests that it is both “strongly justified” and “highly likely”.

While cuts are essential from Europe proper, CIBC suggests that further rate cuts may do more harm than good in the U.K., “by aggravating dichotomies between the recessionary manufacturing sector and the buoyant household sector”. It doesn’t expect easing in the U.K. any time soon.