ECB Eyes Interest Rate Cut Amidst Inflation Concerns
The European Central Bank (ECB) considers a possible interest rate cut within six months due to economic conditions. Despite recent signals to pause policy easing, low inflation concerns persist. ECB's Francois Villeroy de Galhau highlighted potential accommodations unless unforeseen global events disrupt this trajectory.
- Country:
- France
The European Central Bank (ECB) may cut interest rates in the next six months, according to ECB policymaker Francois Villeroy de Galhau. Speaking on Thursday, Villeroy noted that barring significant international disruptions, monetary policy could lean towards increased accommodation.
This comes after the ECB signaled a halt in policy easing despite forecasts of inflation temporarily falling below the 2% target, impacted by the strong euro and declining oil prices. Such conditions rekindle worries of a return to the low-inflation environment seen before the pandemic.
In a speech delivered at the European University Institute in Italy, Villeroy emphasized that unless a major exogenous shock occurs, such as military developments in the Middle East, a policy shift towards easing is conceivable.
(With inputs from agencies.)
Google News