ECB sees potential for more interest rate cuts

A European Central Bank (ECB) official believes there is still room to lower interest rates further. He downplayed concerns that U.S. tariffs would significantly raise inflation in the eurozone. Earlier this month, the ECB cut rates to help boost the struggling eurozone economy. Francois Villeroy de Galhau, a member of the ECB’s governing council, spoke to a German newspaper. He mentioned that the impact of tariffs on inflation in Europe will be less severe than in the U.S. Villeroy highlighted a positive trend, saying eurozone inflation is easing. In February, inflation dropped to 2.3%, which is close to the ECB's target of 2%. Villeroy noted that while future rate cuts are possible, the pace of these changes is still uncertain. He suggested that the key deposit rate might fall to 2% by summer, down from the current 2.5%. Decisions on interest rates will depend on upcoming economic data.