Greek ECB Governing Council member Yannis Stournaras told Bloomberg today that a 25 bps rate cut at the upcoming December meeting would represent “an optimal reduction”.
He acknowledged that interest rates remain firmly in restrictive territory, emphasizing that even with continued cuts to reach the neutral rate, “it’s still a long way to go,” indicating multiple reductions are likely ahead.
Stournaras also highlighted the optimistic revision in inflation expectations. “The baseline is that now, inflation falls more rapidly than we thought in our September forecasts,” he noted, adding that ECB could meet its 2% inflation target on a sustainable basis by early to mid-2025 rather than by the end of the year.
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