ECB’s Šimkus: I agree with markets which sees two more rate cuts this year

Dhwani Mehta FXStreet

European Central Bank (ECB) Governing Council member Gediminas Šimkus said on Friday “I agree with markets which see two more rate cuts this year.”

“Interest rates will keep getting lower, and quite significantly,” he added.

Further comments

Services inflation is still very strong.

Economic expansion is likely weaker than forecast.

There is no reason for cuts to exceed 25 bps each.

There is no doubt that the topic of a cut will be discussed in September.

A cut of 1% per year is significant.

Market reaction

EUR/USD is holding a lower ground on these above comments, testing 1.0880, down 0.13% on the day.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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