Member of the European Central Bank (ECB) Governing Council and National Bank of Belgium (NBB) Governor Pierre Wunsch shared on Wednesday that a 50 basis point cut in central banks' interest rates could be possible this year should data allow it.
During his speech at a lecture in Frankfurt, the central banker cautioned that the risks of keeping tight monetary policy "too long" are far greater than those of prematurely easing interest rates. Wunsch emphasized the importance of the ECB directing greater attention to short-term expectations and wage dynamics, particularly in light of the observed volatility.
In April, the ECB decided to leave its key interest rates unchanged, maintaining the main refinancing operations rate at 4.50%, the marginal lending facility at 4.75%, and the deposit facility at 4.00%.
