ECB Vice President Luis de Guindos emphasized the bank’s expectation of having “far more data” by June, which will be crucial for evaluating the appropriateness of a rate reduction.
De Guindos also noted the current market optimism for a “soft landing” and the continued decrease in inflation. However, he warned “there could be a different situation that leads to an abrupt adjustment.”
At the same event in Madrid, Governing Council member Pablo Hernandez de Cos conveyed a similar sentiment, suggesting that, based on current expectations and if macroeconomic and inflation forecasts hold, rate cuts could commence as early as June.
However, de Cos was careful to clarify that this projection does not constitute “explicit monetary policy guidance” but rather but rather “guidance that is conditioned by the evolution of data and how they can surprise us in one direction or another.”
