The post European Central Bank Braces For Two More Rate Cuts, Is US Fed Next? appeared on BitcoinEthereumNews.com.

The European Central Bank (ECB) is preparing for two more rate cuts, as revealed by ECB policymaker Yannis Stournaras. Hence, netizens are speculating whether the U.S. Federal Reserve would mirror a similar move in September. As of the latest update, the Federal Open Market Committee (FOMC) decided to keep rates steady. European Central Bank To Cut Interest Rates The ECB rate cut prediction, shared in an interview with the German financial newsletter Platow Brief, reflects the central bank’s concerns over a weakening euro zone economy. This could potentially drag inflation below its 2% target. Stournaras serves as the head of the Bank of Greece and is considered one of the more dovish members of the ECB’s Governing Council. He highlighted the lower-than-expected economic growth and its implications for inflation. “The renewed signs of weak economic activity and the high level of uncertainty will very likely dampen inflation more than had been expected,” he stated, according to a Bloomberg report. The statement suggests a significant risk of inflation falling below the ECB’s target in the medium term. Despite a slight uptick in euro zone inflation for July and growth for the second quarter, traders anticipate that the ECB will resume lowering borrowing costs by September or October. Furthermore, this outlook is reinforced by ongoing surveys pointing to a deceleration in economic activity. Stournaras supported this expectation. However, he noted that forthcoming data, particularly on wages, and the ECB’s new economic projections, will be critical in shaping future decisions. “I still expect two rate cuts this year if disinflation continues as expected,” he remarked. This underscores the delicate balance the ECB must maintain. Earlier, European Central Bank cut interest rates by 25 basis points on July 6, 2024. Also Read: Breaking: Bank of England Cuts Interest Rate First Time in 4-Years, Bitcoin Recovery…

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Filed under: News - @ August 1, 2024 10:16 pm