European Central Bank president Christine Lagarde noted that risks to growth are balanced in the near term but are skewed towards the downside in the medium term. According to her, the euro area economy is expected to continue to recover in the coming quarters.
Regarding price pressures, Lagarde said inflation is expected to fluctuate around current levels for this year and to decline only towards the target in the second half of 2025.
The ECB's boss also admitted that wages are still rising at an elevated pace but forward-looking indicators signal that wage growth will moderate during the year.
Commenting on today's rate cut, Lagarde stated that the move is justified by confidence in inflation's path ahead.
She also noted that the ECB will need more data to constantly confirm the disinflationary path, but stressed that the decision and data releases are not perfectly synchronised.
The ECB's president, however, acknowledged that there will be other bumps on the inflation road and some of them can be anticipated, like base effects.
Also, she highlighted that the ECB is not pre-committing to a particular rate path.