European Central Bank (ECB) Governing Council member Madis Muller said in a blogpost on Friday that while the bank's decision to cut its interest rates by 0.25 percentage points was "expected," it was an "important step."
"It confirmed the most important thing from the central bank's perspective: the momentum of price increases in the euro area is fading. Since the economic situation is still rather poor, another cut in interest rates is justified," the policymaker stated, adding that with the latest move, the ECB is "closer and closer to a situation" where rates can no longer be viewed as "high or a hindrance to sensible investments."
Muller further mentioned that it is "entirely realistic" to believe that inflation will be close to the 2% goal by the middle of 2025. He remarked, however, that uncertainty remains, as the world is yet to see the effects of the United States' potential trade policy changes.