Francesco Fedele, CEO, BF.direkt:
"We welcome the fact that the ECB is now taking a break after eight interest rate cuts since June 2024. Because there is no need for action for a key interest rate change. Inflation continues to decline and is forecast to reach 2.0 percent over the next twelve months. However, this forecast is subject to great uncertainty. A trade war with the US with high tariffs and counter-tariffs could lead to an increase in inflation. At the same time, there is also a risk that inflation will fall below 2.0 percent if the economy in Germany and in Europe as a whole is even more in crisis – also fueled by the conflict with the USA. For all these scenarios, the ECB must remain capable of acting. That is why it is right for the ECB to stick to the current key interest rate level.
It will be exciting to see how the ECB will decide at the next interest rate date in September. At least one more interest rate cut this year has already been priced in on the financial markets. Even though we are in favour of further interest rate pauses in principle, it remains to be seen how the political framework will develop in the coming months."
