Summary
- It was reported that there is speculation that the ECB will rush to cut its policy rate.
- The market sees a 90% probability that the ECB will cut the benchmark interest rate by 0.25 percentage points on the 17th.
- Economic growth concerns have emerged as a more important issue than inflation, it was explained.
As concerns about a global economic recession deepen due to U.S. President Donald Trump's tariff policy, there is speculation that the European Central Bank (ECB) will rush to cut its benchmark interest rate (policy rate).
The Financial Times (FT) reported on the 7th (local time) that the market sees a 90% probability that the ECB will cut the benchmark interest rate by 0.25 percentage points at its meeting on the 17th. Frédéric Ducrozet, head of macroeconomic analysis at Pictet Asset Management, said that the possibility of a 0.25 percentage point rate cut at this month's and June's meetings has become "a really easy decision," predicting that "it will be a 'disaster' if rates are not cut." Rather, the ECB's issue is whether it should increase the rate cut to stimulate the economy. Mahmood Pradhan of Amundi Asset Management explained that "economic growth has become a more important issue globally than inflation concerns."
The ECB has cut its policy rate (deposit rate) five times in a row until last month.
Reporter Sangmi Ahn saramin@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
