ECB Reduces Interest Rates Amid Trade Concerns

FRANKFURT: The European Central Bank (ECB) has once more diminished interest rates, a decision reached amidst growing anxieties that US President Donald Trump’s sporadic tariff announcements might jeopardize economic expansion throughout the Eurozone.

ECB decision-makers opted to curtail rates by a quarter of a percentage point, signifying the central bank’s sixth successive reduction in borrowing expenses for the single currency region.

This resolution has effectively lowered the ECB’s primary deposit rate to 2.25 percent, marking its nadir since the start of 2023.

Rate-setters have progressively eased borrowing costs within the Eurozone, aligning with the deceleration of inflation towards the ECB’s targeted two percent.

However, while inflation demonstrates movement in the desired trajectory, the ECB conveyed in a statement that “the outlook for growth has been negatively impacted due to increasing trade tensions”.