European Central Bank (ECB) Executive Board member Fabio Panetta said on Friday that inflation in the euro area is expected to continue falling in the coming quarters. He argued the ECB must not let its monetary policy become too restrictive because that would push inflation below the central bank's symmetrical target. However, he indicated that the policy will remain restrictive even after several rate cuts, the first of which is expected next Thursday.
Panetta said more cuts can be expected over the coming months if the incoming data reports support the ECB's forecast. He repeated the ECB's stance that it will "take into account" the United States Federal Reserve's decisions but that it will follow its own path.
