The fall in inflation in the eurozone provides more confidence to the members of the ECB Governing Council, “but not enough”, according to the president of the entity, who has assured that, even if there will be slightly more According to information, there will be “many more in June.”
The disinflation process underway in the eurozone has made this possible European Central Bank (ECB) is improving its forecasts and offering more confidence to the members of the Governing Council, “but not enough”, according to the entity’s chairman, Christine Lagarde, who has assured that, although there will be slightly more information in April, there will be “many more in June.”
“A clear decline is underway and we are making progress towards our inflation target and as a result we are more confident, but not enough and clearly we need more evidence, more data‘Lagarde said this at the press conference after the ECB Governing Council meeting.
In this sense, the Frenchwoman recalled that some of these data will arrive in the coming months, which will allow the ECB to be informed a little more in April, “but we will know a lot more in June”adding that this was the conclusion of the debate during Thursday’s meeting in the Governing Council, which in its previous conclave had not even considered the question of when to address the shift in monetary policy.
In fact, the President of the ECB wanted to make it clear that at this meeting there was no discussion about lowering interest rates and that the entity’s governing body has only just begun to debate whether to adjust its restrictive stance, as the central bank demands “much more information in the coming months to have sufficient confidence”.
The ECB has improved its inflation projections for 2024 and 2025, mainly due to a lower contribution from energy prices, and now expects headline interest rates to average 2.3% this year and go to what you want 2% by 2025 to place yourself in the 1.9% in 2026.
In any case, the President of the ECB has made it clear that the institution won’t wait to cut rates until rates fall to 2%, while he has defended that despite the cooling in this year’s GDP growth forecast, “it’s not about sacrificing growth” as the ECB’s projections consider recovery in 2024 and, especially in 2025 and 2026.
On the other hand, when asked about the pace of easing the ECB’s restrictive policy once the entity decides to cut rates, Lagarde avoided committing to any commitment. rhythm or volume, bearing in mind that the institution will remain ‘dependent on data’. “But if the conditions are met and our diagnosis is good, we will do what we have to do,” he added.
Source: EITB
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