ECB’s Stournaras: To Continue Cutting Interest Rates in December

2 December 2024

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Yannis Stournaras on Monday said that the ECB would further cut interest rates this month.

In an interview at the Greek OT Forum, Stournaras, who heads the Bank of Greece, said that ‘inflation is falling’ and Europe’s economy is ‘somewhat weak’.

‘So in December we will continue to cut interest rates, it seems’, he said, dismissing November’s increase of inflation from the previous month as a ‘small’ and ‘foreseen’ energy-related base effect.

‘We expect it to go up maybe a little bit in December’, he said. ‘But then it will fall a lot.’

The ECB would not intervene in bond markets for the sake of France as things now stood, Stournaras said.

‘There is a tool, the TPI, but in order for this to be implemented, the country in question must have taken the necessary measures to reduce the excessive deficit’, he said. ‘At the moment this cannot be done.’

A crisis however was not in the making, he said.

‘I don't see it’, he said. ‘There is no need to predict the worst at the moment. After all, don't think French bonds are collapsing.’