(Recasts with economists' comments, background)
By Jan Strupczewski
BRUSSELS, Nov 27 (Reuters) - Euro zone economic sentiment hit 15-year lows in November and inflation expectations among companies and households fell off a cliff, boosting the case for a bigger than 50-basis-point rate cut by the ECB next week.
A monthly European Commission survey showed that growing pessimism in industry and services pulled euro zone economic sentiment down to 74.9 points -- the lowest reading since 74.2 recorded in August 1993 -- from 80.0 in October.
Services and industry account for the bulk of euro zone gross domestic product, so the fall underlines economists' expectations that the 15-country area's economy will shrink in the fourth quarter following negative second and third quarters.
"The euro zone is in a deep recession, upping the pressure on the ECB to cut interest rates further," said Christoph Weil, economist at Commerzbank. "We envisage a first move next week on a scale of 75 basis points to 2.5 percent."
European Central Bank President Jean-Claude Trichet said on Wednesday the bank could cut its main interest rate next week as long as there was evidence that inflation pressures had eased.
"We will have a lot of new information and we did not exclude to decrease rates again if the upside risk to prices alleviates," Trichet said.
The Commission survey showed that inflation expectations plunged this month to well below long-term averages.
Selling-price expectations among companies fell to 1 point from October's 6 points and were well below the long-term average of 6. Consumer inflation expectations fell to 11 points from 19 and were also well below the average of 23.
"The sentiment indicator adds to the case for a bigger rate cut from the ECB next week than we have seen up until now," said Nick Kounis, chief European economist at Fortis Bank.
The ECB cut interest rates in October and November by 50 basis points each time to the current level of 3.25 percent.
Some economists said an even deeper cut than 75 basis points would be better.
"(An) appropriate (move) would be up to 100 basis points, but that would be radical for the ECB -- 75 basis points would be worth considering," said Holger Schmieding, economist at Bank of America.
The drop in economic sentiment was driven by a much sharper- than-expected decline in services sentiment, which fell to -12 points from -7 and in industry, which sank to -25 from -18.
Sentiment also deteriorated among consumers -- to -25 from -24 points and in the construction sector, to -24 from -20.
Sentiment in the retail sector stayed unchanged at -13. (Editing by Dale Hudson)