Luis de Guindos, the Vice President of the European Central Bank (ECB), said the September ECB meeting will be a "much better" moment than the July meeting for a possible new cut. He added that new data and macroeconomic projections will help to better assess the situation in monetary policy.
"Data-wise, September is a much more convenient month for taking decisions than July was," de Guindos said.
Meanwhile, he warned that consumer inflation in the eurozone is likely to remain at current level until the end of this year. But de Guindos expressed confidence that the disinflation process will continue from the beginning of 2025, given expectations that wage dynamics will begin to slow down.
"If wage growth normalizes, then inflation in the service sector, which is most sensitive to wage dynamics, will also decrease, and this will allow the ECB to reach the target level (2%) by the end of 2025," de Guindos said.
According to the final data from Eurostat, the consumer price index rose in June by 2.5% per year, as expected, after an increase of 2.6% per year in May. European Union annual inflation was 2.6% in June, down from 2.7% in May. Meanwhile, on a monthly basis, the consumer price index rose again by 0.2%, confirming economists' forecasts. This was the fifth increase in a row, but the weakest in this series. The core consumer price index - excluding energy, food, alcohol and tobacco - rose by 2.9% per year, as expected, after a similar increase in May.