The European Central Bank might consider reducing its key interest rate sooner than the U.S. Federal Reserve, according to ECB Governing Council member Robert Holzmann’s remarks on Saturday.
“Europe could cut interest rates before the U.S.,” Holzmann stated in an interview with Austrian newspaper Kronen Zeitung, citing slower economic growth in Europe compared to the United States.
Holzmann, aged 75 and serving as the governor of the Austrian National Bank, disclosed to the paper his decision not to pursue a second term as the head of the country’s central bank, with his current term set to conclude by the end of August 2025.
Holzmann mentioned the discussions within the ECB’s Governing Council are ongoing regarding the timing of potential rate cuts.
“Based on the present circumstances, I anticipate interest rate reductions. The timing will largely hinge on wage and price trends leading up to June,” he elaborated.
Holzmann emphasized that lower wage agreements in Europe would provide greater flexibility to decrease borrowing costs.
