As inflation has slowed down significantly, economists are increasingly discussing the possibility of interest rate cuts by the European Central Bank (ECB). While some predict a cut will happen in June, others believe it may not occur until later. The upcoming interest rate meetings of the Council are scheduled for April 11 and June 6.
A recent Reuters poll of 77 economists from 25-28 March revealed that a majority of them expect the ECB to begin cutting interest rates in June. However, 68 economists believe that the key interest rate will remain unchanged in April, with a cut expected to happen in June. Despite this uncertainty, financial markets are anticipating a 0.25 percentage point cut in June.
Some economists predict that the central bank will make a total cut of 1.00 percentage points this year, while others estimate cuts of 0.75 percentage points or lower. The central bank aims for a two percent inflation rate in the medium term, which adds to the speculation surrounding interest rate cuts in June.
The central bank is expected to have new data on wage development at the beginning of the year in June, which could further support the case for interest rate cuts. However, varying views and expectations among economists indicate uncertainty in the economic outlook and factors influencing monetary policy decisions.
