Economic news

ECB’s rate cut direction clear, pace up for debate, Lagarde says

2024.10.22 12:21

WASHINGTON (Reuters) -Euro zone inflation is easing and may fall back to 2% quicker than previously thought, supporting the case for further European Central Bank rate cuts, ECB President Christine Lagarde said on Tuesday.

The ECB has already cut rates three times this year from a record high, and markets see policy easing at each of its upcoming meetings well into next spring.

“I’m absolutely confident that we will reach that target sustainably in the course of 2025,” Lagarde told a Bloomberg Newsmaker event.

When asked if this could happen sooner than the ECB’s last projection – the final quarter of 2025 – she said: “That would be my hope.”

Still, she argued that caution was warranted and the ECB was not yet in position to declare victory.

Lagarde said this made the direction for policy “clear” but that the pace of further cuts in the 3.25% deposit rate remained dependent on incoming data.

Lagarde also sidestepped questions on the destination for rate cuts, arguing that the so-called neutral rate, which neither stimulates nor slows the economy, was not clear-cut.

© Reuters. FILE PHOTO: European Central Bank (ECB) President Christine Lagarde speaks to reporters following the Governing Council's monetary policy meeting in Frankfurt, Germany September 12, 2024. REUTERS/Jana Rodenbusch/File Photo

The neutral rate is seen by economists at around 2% or 2.25%. Lagarde argued that it was probably higher now than a few years ago, but below the current rate, which was still clearly restrictive.

“So if you were to ask me today, ‘Where is it?’, the honest answer is, I don’t know,” Lagarde said.



Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 85,080.80 1.11%
ethereum
Ethereum (ETH) $ 2,198.59 1.49%
tether
Tether (USDT) $ 0.999739 0.04%
xrp
XRP (XRP) $ 2.14 0.15%
bnb
BNB (BNB) $ 607.67 3.09%
solana
Solana (SOL) $ 139.40 4.55%
usd-coin
USDC (USDC) $ 1.00 0.00%
dogecoin
Dogecoin (DOGE) $ 0.201994 0.99%
cardano
Cardano (ADA) $ 0.633744 0.27%
staked-ether
Lido Staked Ether (STETH) $ 2,196.58 1.45%
tron
TRON (TRX) $ 0.230805 0.37%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 84,894.75 1.11%
hedera-hashgraph
Hedera (HBAR) $ 0.234607 11.84%
litecoin
Litecoin (LTC) $ 124.92 0.30%
wrapped-steth
Wrapped stETH (WSTETH) $ 2,628.65 1.31%
chainlink
Chainlink (LINK) $ 14.56 0.66%
stellar
Stellar (XLM) $ 0.298532 4.86%
leo-token
LEO Token (LEO) $ 9.76 5.42%
sui
Sui (SUI) $ 2.80 0.24%
avalanche-2
Avalanche (AVAX) $ 21.41 2.64%
the-open-network
Toncoin (TON) $ 3.25 2.41%
shiba-inu
Shiba Inu (SHIB) $ 0.000014 1.89%
usds
USDS (USDS) $ 1.00 0.02%
mantra-dao
MANTRA (OM) $ 7.42 0.64%
polkadot
Polkadot (DOT) $ 4.59 2.46%
hyperliquid
Hyperliquid (HYPE) $ 19.18 2.50%
weth
WETH (WETH) $ 2,200.19 1.45%
bitcoin-cash
Bitcoin Cash (BCH) $ 309.21 0.61%
ethena-usde
Ethena USDe (USDE) $ 0.999008 0.01%
bitget-token
Bitget Token (BGB) $ 4.04 1.33%
wrapped-eeth
Wrapped eETH (WEETH) $ 2,333.60 1.45%
uniswap
Uniswap (UNI) $ 7.37 1.21%
monero
Monero (XMR) $ 217.50 3.14%
whitebit
WhiteBIT Coin (WBT) $ 26.40 0.51%
near
NEAR Protocol (NEAR) $ 3.17 3.80%
aptos
Aptos (APT) $ 6.38 0.11%
dai
Dai (DAI) $ 1.00 0.09%
pepe
Pepe (PEPE) $ 0.000008 5.98%
ondo-finance
Ondo (ONDO) $ 0.993743 0.15%
internet-computer
Internet Computer (ICP) $ 6.41 1.62%
susds
sUSDS (SUSDS) $ 1.04 0.01%
aave
Aave (AAVE) $ 189.78 0.77%
ethereum-classic
Ethereum Classic (ETC) $ 18.88 2.08%
bittensor
Bittensor (TAO) $ 329.96 0.02%
okb
OKB (OKB) $ 44.96 0.09%
official-trump
Official Trump (TRUMP) $ 13.01 0.87%
gatechain-token
Gate (GT) $ 20.69 0.22%
mantle
Mantle (MNT) $ 0.742903 2.54%
coinbase-wrapped-btc
Coinbase Wrapped BTC (CBBTC) $ 84,983.77 1.02%
sonic-3
Sonic (prev. FTM) (S) $ 0.731511 7.95%