European Central Bank Vice President Luis de Guindos said that given the decline in inflation in the eurozone, the ECB will continue to reduce interest rates. Meanwhile, he added that it is now difficult to make predictions about the specific number and amount of rate cuts.
According to official data, consumer price growth accelerated in October, confirming experts' forecasts and preliminary estimates. Meanwhile, core inflation has stabilized. The consumer price index rose by 2.0% per year, as expected, after an increase of 1.7% per year in September (the lowest level since April 2021). Meanwhile, on a monthly basis, the consumer price index rose by 0.3%, as expected, after a 0.1% decline in September. It was the strongest price increase since April. The core consumer price index - excluding energy, food, alcohol and tobacco - rose by 2.7% per year, as expected, after a similar increase in September. Thus, inflation remained at its lowest level since February 2022.
"The trajectory of our monetary policy is clear – if our forecasts are confirmed, we will continue to make monetary policy less restrictive. But this process will depend on the dynamics of inflation," Luis de Guindos said, and pointed to the weak prospects for the eurozone economy as "one of the main risks that we see now."
He also repeated warnings about the consequences of Donald Trump's re-election and the trade tariffs that may ensue.