Isabel Schnabel, a member of the European Central Bank’s (ECB) Executive Board, has stated that the ECB should maintain the current interest rates. Despite challenges posed by tariffs imposed by the United States, the Eurozone economy remains stable, and inflation rates may exceed expectations. The ECB recently ended its accommodative monetary policy that lasted for a year and is now assessing the full impact of the tariff agreement reached with the U.S. in July to determine whether further reductions in borrowing costs are necessary. Known as a hawkish member of the ECB, Schnabel opposes any further cuts in interest rates, arguing that the current rate of two percent provides moderate stimulus to an already sufficiently active economy. She noted that the ECB has likely already implemented a somewhat accommodative monetary policy and sees no justification for additional rate cuts under the present circumstances. The ECB’s role is to formulate monetary policies for the Eurozone and control inflation to ensure economic stability. Changes in interest rates are made to meet inflation and economic growth targets, with the goal of maintaining balance and financial stability amid uncertainty. Going forward, the ECB’s policy committee will carefully review the effects of the tariff agreement with the U.S. and adjust monetary policy if needed. However, current analysis suggests that immediate interest rate cuts are unlikely, providing investors and markets with expectations of a stable financial environment.
Source: binance
