BENGALURU (Reuters) - The European Central Bank will cut its deposit rate next week and announce a restart of its asset purchase program, but over 80% of economists polled by Reuters were skeptical about the bank’s ability to influence inflation over the medium term.

Less than a year ago, the ECB shuttered its 2.6 trillion euro quantitative easing program and gave guidance it would raise interest rates by the end of this year.

But the ECB has changed course, along with many of its peers. The U.S.-China trade war has slowed global growth, and now the euro zone’s biggest economy, Germany, appears headed for recession.

The Aug. 29-Sept. 3 poll showed nearly 70 economists were expecting the ECB to cut its deposit rate at its Sept. 12 meeting, with the vast majority predicting a 10 basis point reduction to -0.5%. Nearly a quarter forecast a 20 basis point cut.

Euro zone money markets give a 60% chance of a 20 basis point cut in the deposit rate from minus 0.4%.

Almost 90% of respondents said the ECB would introduce some form of compensation for banks to offset the unwelcome side-effects of negative interest rates.

And nearly 90% of respondents also expected the ECB to announce the restarting of its money printing presses, with monthly purchases of 30 billion euros from October.

While more than three-quarters of economists said now is the right time for the ECB to roll out a stimulus package, over 80% of respondents said they were not confident the central bank could control inflation.

“The ECB should do something even though it is not going to be sufficient to reach the target. That is a situation they have actually been in for quite a long time already and it is a situation the Bank of Japan has been in for much longer,” said Andrew Kenningham, chief Europe economist at Capital Economics.

FILE PHOTO: Sign of the European Central Bank (ECB) is seen outside the ECB headquarters in Frankfurt, Germany, March 7, 2019. REUTERS/Kai Pfaffenbach/File Photo

“They haven’t got any choice ... otherwise they would be saying ‘we are not going to fulfill our mandate’. But not many believe inflation is likely to pick up anytime soon, particularly given the state of the world economy and the euro zone economy.”

The Reuters poll was taken before an exclusive Reuters story based on sources that suggested ECB policymakers were in favor of a stimulus package including a deposit rate cut with a tiered system and a reinforcement of forward guidance.

That came after last week’s flash reading of 1% for August headline inflation -- the same as in July and the lowest since late 2016.

Even with a host of ECB stimulus measures now widely expected, a majority of economists in the latest poll downgraded their own inflation outlooks for next year -- with the consensus for 2020 the lowest since polling began in April last year.

“I don’t think the ECB will reach its inflation goal in the foreseeable future, but things would be worse without more monetary stimulus. What they will at least be able to do is to prevent inflation from falling further,” said Kristian Toedtmann, senior economist at Dekabank.

“The ECB needs to defend its credibility in being able to reach its inflation goals. Therefore I expect the ECB to respond with a strong package.”

Median forecasts for quarterly growth ranged between just 0.2% and 0.3%, little changed from last month, but with lower highs and lower lows for most quarters over the coming two years.

A majority of respondents either lowered their annual average forecasts for growth or kept them unchanged from the previous poll.

Those concerns pushed the chance of a euro zone recession in the coming year to 25% in the latest survey from 20% in July’s poll. But the probability held at 30% in the next two years.

The poll median forecast the ECB to cut its deposit rate again to -0.6% next quarter and then keep it on hold through to at least the end of 2020.

But while a majority of economists said the central bank should deliver a stimulus package next week, almost a fifth said it should not.

“The stimulus package will not be effective in terms of bringing about a recovery or in terms of bringing inflation to target. On the other hand, it runs the risk of being counterproductive,” said Michael Schubert, senior economist at Commerzbank.