ECB’s Stournaras: Three Interest Rate Cuts in 2024 Most Likely Scenario

2 May 2024

By Aurėja Bobelytė – VILNIUS (Econostream) – Three interest rate cuts are more likely than four this year, European Central Bank Governing Council member Yannis Stournaras said Thursday.

In an interview with Greek news outlet Liberal, Stournaras, who heads the Bank of Greece, said that after analysing Eurostat’s new data, ‘we now consider three rate cuts in 2024 as the more likely scenario’.

According to Stournaras, a June rate cut could be followed by a July cut and an additional reduction later in the year.

‘[O]nce we start cutting interest rates and inflation continues to develop in line with our latest forecasts, we should not stop until we reach the equilibrium rate’, he said.

The new data were in line with the ECB’s inflation projections, but first quarter output figures surprised positively, Stournaras said.

‘If this pace of economic growth continues, then consumer price growth is likely to be marginally higher than our March forecast, but without jeopardising the 2% target in mid-2025’, he said.