The European Central Bank is ready for further interest rate cuts, Christine Lagarde said. Despite the four cuts already carried out, the ECB believes that the current rate level, which has reached 3%, still has a restraining effect on the economy. The head of the regulator noted that previously inflation risks were mainly associated with their possible increase, but now the situation has changed and the risks have become more balanced. It is expected that in the middle of next year, rates will reach a neutral level, which does not restrain or stimulate growth. Determining this level, which can range from 1.75% to 3%, is a difficult task, as it depends on many variables. The European economy continues to face growth challenges, and confidence levels among households and businesses remain low. The ECB forecasts growth to accelerate to 1.1% next year, but political instability and global conflicts may negatively affect this forecast. Analysts expect consistent rate cuts of up to 2%, and investors are considering more significant steps.
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