Lagarde did not set a date for cutting interest rates, but indicated that the signs that will appear by June will be decisive. In response, many officials supported the reduction until the end of the first semester.
The European Central Bank meeting was held on Thursday and officials chose to keep benchmark interest rates between 4 and 4.5%. Later, Lagarde's comments at a press conference set the agenda, although there was no commitment to a deadline for interest rate cuts.
In response to Lagarde, many prominent figures in the banking sector were in favor of easing the ECB's monetary policy before the end of the first half of the year.
Bank of France Governor François Villeroy de Galhau said it was “very likely that there will be a first rate cut in the spring.” He explained in an interview with “BFM Business” that “spring lasts from April until June 21.”
“The first move will be very important, and will show that we have changed our way,” in order to lower interest rates, Bank of Latvia Governor Martins Kazaks said. However, he points out that the decline will not necessarily be constant, from one meeting to the next.
In Eastern Europe, Governor of the Bank of Lithuania, Gediminas Simkus, confirmed that “a cut in interest rates in June is very likely,” with a “low probability” of action in April. He also added that “there is no reason for this to be more than 25 basis points at a time.”
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