ECB’s Nagel open to rate cut at upcoming meeting

ECB Governing Council member and Bundesbank President Joachim Nagel, one of the central bank’s leading hawks, signaled today that he is “open” to considering another interest rate cut at the next meeting.

Nagel acknowledged the “very encouraging” inflation data, while has recently dropped below ECB’s 2% target for the first time since 2021. But also highlighted that the persistent strength in core inflation suggests the ECB’s inflation battle is not yet over.

Separately, Governing Council member Martins Kazaks pointed out that recent economic data support the case for an interest rate cut in October. Though he’s still concerned with the high uncertainty globally due to “wars, conflicts, and the United States presidential elections.”

Another Governing Council member Bostjan Vasle acknowledged the option for a rate cut. But he stressed that such a decision would not necessarily signal another cut in December, adding that “the markets aren’t dictating our moves.”