watch nowThe European Central Bank delivered an expected quarter-point interest rate cut this week — and alongside the announcement came several indications that rates will swiftly move even lower early next year.
Economists also jumped on the removal of the ECB's message that the central bank must "keep policy rates sufficiently restrictive for as long as necessary."
She also said that a larger, half-point cut had been debated, and that Governing Council (GC) members unanimously voted to reduce rates.
The ECB cut the deposit facility — its key rate — to 3% on Thursday.
What constitutes the neutral rate has been a key point of debate in recent months, and Lagarde said Thursday that while it had not been discussed at the December meeting, staff saw it between 1.75% and 2.5%.
Persons:
Christine Lagarde, Robert Holzmann —, —, Holzmann, Lagarde, Francois Villeroy de Galhau
Organizations:
European Central Bank, ECB, Reuters
Locations:
Frankfurt, Austrian