Senior officials of the European Central Bank have spoken intensively at the global central bank annual meeting, with a growing call for interest rate cuts in September.
Several officials from the ECB's Monetary Policy Committee have recently proposed the reason for further easing monetary policy at the September meeting. According to a recent survey by economists, the eurozone's inflation rate in August is expected to drop to 2.2%, unexpectedly rising to 2.6% in July. European Central Bank policymakers are increasingly concerned about economic growth.
Is a rate cut in September a sure thing? European Central Bank officials are reportedly close to reaching an agreement.
① According to media reports, European Central Bank decision-makers are close to reaching a consensus on interest rate cuts in September, and it will only be delayed if there are major unexpected data in the coming weeks; ② The market currently believes that the possibility of an interest rate cut in September exceeds 90%, and it is expected that there will be at least one more interest rate cut in the remaining time this year, followed by a steady reduction in 2025.
European Central Bank's Vujcic expects gradual interest rate cuts and reminds caution.
European Central Bank Council member Boris Vujcic stated that as the inflation rate approaches 2%, the European Central Bank is likely to have space for a slow interest rate cut, but risks still exist, and officials must act with caution. "As long as the data is in line with our predictions, and inflation is expected to decrease to 2% by 2025, it will strengthen our confidence in gradually easing the restrictions on monetary policy." The Croatian central bank governor said in an interview, "But we should proceed cautiously and take action very slowly." He indicated at the annual Jackson Hole meeting of the Federal Reserve that a rate cut in September is possible, which is widely expected by investors.
The European Central Bank said that consumer inflation expectations in July rose slightly.
European Central Bank data shows that consumer inflation expectations in the eurozone have slightly increased, but this increase is unlikely to be enough to prevent officials from pushing for interest rate cuts. The European Central Bank stated in its monthly survey on Friday that prices are expected to rise by 2.8% in the next 12 months, unchanged from the June survey, while the three-year price rise expectation has increased from 2.3% to 2.4%. Expectations for price trends play a crucial role in driving inflation itself, and policymakers are still seeking concrete evidence to prove that the 2% target will be achieved as planned later next year. Policymakers will hold the next interest rate decision meeting in September, when new quarterly forecasts will be released.
ECB: Eurozone Consumer Inflation Expectations Hold Steady in July
The latest data supports the European Central Bank's interest rate cut in September! The governing committee believes that reducing borrowing costs is desirable.
①European Central Bank governing council member Martins Kazaks said at the Jackson Hole annual meeting that he is very open to the European Central Bank cutting interest rates again in September; ②Kazaks expressed confidence in inflation returning to 2%, and also indicated a signal of economic weakness; ③he pointed out that it is desirable to gradually reduce borrowing costs, and the next ECB meeting will be held in three weeks.