ECB Set to Ease: Rate Cuts on the Horizon

The European Central Bank (ECB) plans to further ease interest rates next year, aligning with market projections. Recent rate cuts aim to support the euro zone economy amid political challenges and trade uncertainties. The ECB anticipates meeting its inflation target by early 2025.

The European Central Bank is poised to ease interest rates further next year, according to ECB policymaker Francois Villeroy de Galhau. Speaking to BFM business radio, Villeroy confirmed that the central bank is comfortable with current market forecasts for rate reductions.

This comes as the ECB executed its fourth interest rate cut of the year on Thursday, despite ongoing political instability in the euro zone and looming U.S. trade threats. The ECB reduced the deposit rate by 25 basis points, bringing it to 3% across the currency bloc.

Further easing may be imminent, as indicated by the central bank's removal of previous guidance suggesting restrictive rates. Economists predict policy adjustments as soon as January, coinciding with inflation targets set for early 2025.

(With inputs from agencies.)