The ECB lowered the deposit rate by 25 basis points to 2.25%, signaling its seventh consecutive decrease since mid-2023. This decision reflects growing pressures from global trade tensions affecting eurozone growth.
A 94% probability of the cut was expected by traders ahead of the announcement. Following the rate cut, the euro dropped approximately 0.3% against the U.S. Dollar as market dynamics shifted.
Investors are closely watching for insights from ECB President Christine Lagarde regarding the neutral interest rate, which will influence future monetary policy. The ongoing trade disputes are causing concerns about long-term economic damage and borrowing costs.
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