The “good way” is being marched on the process of deflation, the President of the European Central Bank (ECB) said today (25.04.2025). Christine Lagardewhile warning that high uncertainty makes it impossible to give clear messages about the interest rates.
“Most of the underlying inflation suggests that inflation will set a steady basis around our medium -term goal,” Christine Lagarde told the IMF sessions in Washington. “As for the future, inflation is expected to be around our goal of 2%.” However, he warned by saying that “especially when the size and distribution of shocks are extremely uncertain, we cannot provide certainty by committing a specific interest rate course.”
While most of the ECB officials remain cautious about what they will do after the seventh interest rate decline last week, some are beginning to signal that it may need more relaxation, as US President Donald Trump’s commercial policies are burdened. At the same time, they have become more confident that inflation will return to 2% this year.
April scheduled data scheduled for next week are expected to show a new recession of inflation to 2.1%, according to average Bloomberg survey. At the same time, the core of inflation may rise.
Investors are now fully invoicing another interest rates in June and expecting one or two more moves during the year. The main deposit rate is currently at 2.25%, a level that is generally considered neutral, so it neither restricts nor stimulates economic activity.
“The downward risks to economic growth has increased,” Lagarde said, stressing the “significant escalation of global commercial tensions”.
However, “the eurozone economy has developed resilience to global shocks,” he added.