ECB Diverges From Fed in Policy Cycle! Here's Why

thecekodok


The European Central Bank is expected to end its interest rate cut cycle after inflation remained around 2% and the economy showed moderate resilience.


A Reuters poll showed all 88 economists expected the ECB to keep rates at 2.00% at its October 30 meeting, with the majority not expecting a change until 2026.


The absence of economic slowdown and inflation closes the door for additional cuts, in contrast to the Federal Reserve which is expected to continue easing monetary policy.


Eurozone growth is forecast to remain stable at between 1.1% and 1.4% through 2027, but risks remain on the downside due to political instability in France and a slowdown in Germany.


Inflation is expected to remain around 2% for the next three years, suggesting the ECB's current policy is sufficient to maintain price stability.

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