VILNIUS (Reuters) – European Central Bank policymaker Gediminas Simkus said on Monday he expected an interest rate cut in March and “a couple more” in the following months.
The ECB cut rates for a fifth time last week and policymakers told Reuters a further move in March was uncontroversial before a deeper rethink at the April meeting.
Simkus, the Lithuanian central bank governor, appeared to suggest more reductions in borrowing costs were on their way because the ECB was some way off the neutral rate that neither spurs nor stifles the economy.
“I don’t think that the decrease in March will be the last one,” he told reporters. “I think that there will be a couple more decreases, after March. I don’t want to tie this to April or any other month, I think this will be done according to information.”
He added the threat of U.S. tariffs on imports from the European Union was “not good news” for economic growth or inflation and introduced “a lot of uncertainty”.
But he would not speculate on the impact, as this depended on the details of any tariff and the EU’s own response.
(Reporting By Andrius Sytas; Writing by Francesco Canepa and Balazs Koranyi in Frankfurt; Editing by Alex Richardson)
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