with Amir Issa
On October 20, 2024
European currencies saw a decline throughout trading last week, especially after the decision of the European Central Bank last Thursday, which reduced the interest rate by a quarter of a percentage point, giving the prime refinancing rate to 3.40%. It is the third interest rate cut this year after it cut the interest rate by 50 basis points at the June and September meetings, by 25 basis points at each meeting, amid expectations that the bank will agree to the fourth cut before the end of the year. 2024. This is supported by the weak prospects for economic growth in the countries of the European Union after a series of long periods of tension that have pushed the euro area economy into recession.
After the decision, the President of the European Central Bank Christine Lagarde appeared in the press conference after the meeting, in which she enumerated the reasons for the decision to cut . Initially, Lagarde said the decision to cut was unanimous in the views of monetary policy makers, although there appeared to be no promises to allow a new cut in interest rates at the upcoming meetings . During her speech, the President of the European Central Bank emphasized the slowdown that the economy is seeing in the euro area, which supports the central bank’s decision to reduce interest rates . It also pointed to policymakers’ confidence in a decline in inflation rates to the European Central Bank’s target of 2% in 2025, although some persistent risks to inflation cannot be ruled out.
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Inflation fell to the lowest level since 2021
The most prominent statements issued in The Eurozone Issued last week, inflation in the euro zone showed a decline last September to the lowest level since 2021. At the same time, the consumer price index recorded The final use of the European Union annual decline in September, reaching 1.7%, compared to 2.2% recorded in August While it was Expectation It marked a decline of 1.8%.
The core CPI, which excludes more vulnerable items, fell in line with expectations to 2.7% in September from 2.8% recorded in August.
In other data, register Trust index Economic confidence rose during the month of October, as the ZEW Economic Confidence Index rose to 20.1 points in October compared to just 9.3 points recorded in September. Finally, the ZEW Economic Sentiment Index in Germany recorded an increase in October, reaching 13.1 points, compared to 3.6 points recorded in September.
2024-10-20 08:19:00
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