Bank of Greece (BoG) Gov. Yannis Stournaras on Monday assuredly forecast that the European Central Bank (ECB) will reduce interest rates by 0.25% (a quarter point) next month, with further cuts possible in 2025. He described the prospect as “reasonable”.
Asked if such a move is a done deal, the Greek central bank chief and ECB council member stressed that “25 basis points is an optimal reduction.”
The ECB interest rates on the deposit facility, the main refinancing operations and the marginal lending facility are 3.25%, 3.40% and 3.65%, respectively, as of October 2024. Stournaras forecast new rates cuts in case inflation continues to decline, subject to unforeseen developments.
Under such conditions, said that by the end of 2025 the ECB’s key interest rate may fall from the so-called “neutral level”.
