FRANKFURT (Reuters) – The European Central Bank (ECB) will most likely cut its key rates just three times this year amid stronger-than-expected economic growth likely to support inflation, said Yannis Stournaras, member of the ECB. monetary institution, in an interview given to Greek media.
While a first cut in ECB rates is practically certain for the month of June, the strength of recent economic indicators has made the trajectory of monetary easing beyond this timetable uncertain.
Yannis Stournaras, also governor of the Bank of Greece, was one of the first ECB officials to call for a rate cut next month. He now estimates that the 0.3% economic rebound recorded in the euro zone in the first quarter makes three rate cuts more likely instead of four.
“Based on this data, we now consider the three interest rate cuts in 2024 as the most likely scenario,” he told Greek news site Liberal.gr.
“If this pace of economic growth continues, consumer price growth will likely be slightly higher than our March forecast, but without compromising the 2% target forecast for mid-2025,” he added. .
He said a second cut in borrowing costs in July remains “possible”, while options beyond the summer are open.
(Reporting Francesco Canepa; French version Claude Chendjou, editing by Kate Entringer)
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