ECB expects inflation to hit 2% by year-end
The European Central Bank (ECB) remains confident that inflation will reach its 2% target by the end of this year, despite recent fluctuations. Wage growth is moderating, which is expected to help reduce inflation in the euro area. Interest rates have been cut by 150 basis points, leading to a less restrictive monetary policy. However, uncertainty remains high due to factors like U.S. tariffs and fiscal policies, which could impact economic growth and trade. The ECB acknowledges the need for structural reforms to enhance productivity and competitiveness in Europe. While credit demand is rising, especially for mortgages, challenges in the housing market persist, particularly for young people seeking affordable housing.