The Bank of Greece Governor reiterated his estimation that there will be two more interest rates this year
A new reduction in interest rates by the European Central Bank in April was announced by Bank of Greece Governor Yiannis Stournaras.
In an interview with Econostream he characteristically said that “if the meeting was today, I would be more confident that we would decide on a decline, because inflation in February was 2.3%, according to the course we have drawn and whether our prediction will also depend on the further decline. Also, figures for the fourth quarter of 2024 show a slowdown in wage growth. Inflation of services is divergent. The core of inflation has also been reduced. Everything is in the direction of a reduction in April. But we don’t have April yet, we’re in March. We have a month ahead of us, so I can’t tell you that we will decide. And uncertainty is so high that it is impossible to know what can happen to change our decision. “
He reiterated his assessment that we would have two more reductions this year and that 2% would be the end rate level, stating that he cannot predict exactly when these two reductions would be made, as in conditions such high uncertainty, it would not be prudent to be so accurate. He ruled out the ECB’s key interest rate to reduce to 2%, saying that “before the European Commission’s decision and the decision on German debt brakes and with a duty war coming from the other side of the Atlantic, there may have been enough evidence to weaken.”
