investEurope has beenCentral bank(ECB) Bank of England (BOE, Bank of England)cut interest ratesGoing forward, the main reason is that a series of data shows that the Eurozone and British economies will enter a period of near stagnation.
Due to concerns that the slowdown in inflation and the impact of previous interest rate hikes will take some time to suppress consumer demand and economic growth, European and British central banks are currently suspending interest rate hikes, as is the US Federal Reserve (Fed). are doing. Chiefs of central banks are optimistic about the future. There has been no softening in the trend of interest rates. ECB President Christine Lagarde warned that it would be “completely premature” to consider cutting interest rates now; BOE Chairman Bailey also noted that there are still “upside risks” to inflation. However, weak economic data and falling inflation have led the market to consider when the central bank will start cutting interest rates next year.
UK retail sales fell short of expectations last week and fell to the lowest level since February 2021; Industrial output in the euro zone is also poor, and France’s unemployment rate rose to 7.4% in the third quarter, the highest level in two years. The European Commission’s latest forecast indicates the economy will grow by 0.6% in 2023, revised down 0.2 percentage points from a forecast in September.
The manager of the French Investment Company (LGIM) said that many expect the European and British economies to soften, so they will only cut interest rates next year; However, LGIM believes the central bank will cut interest rates sharply to respond to the deterioration in economic conditions.
Vera Dick, chief European economist at Prudential Investment Company, said, “An interest rate cut is likely to happen earlier than market expectations; not only because of the decline in inflation, but also on the basis of weak economic data. Bank of England interest rates. “Can make the cut.” For the first time in May next year.
finance(tagstotranslate)interest rate cut