The European Central Bank expects to cut growth and inflation forecasts substantially when they are updated next month, ECB council member Guy Quaden was quoted as saying on Tuesday.
“It’s more than probable (that the ECB) ... will have to modify substantially its projections in December for growth and inflation,” Bloomberg reported Quaden as saying in an interview carried out in Sao Paulo late on Monday. “It’s surely not excluded that the revision of the projections will have consequences on the field of our monetary policy,” he added.
Two quick-fire cuts since October has seen the ECB reduce interest rates by a full percentage point and policy makers including ECB President Jean-Claude Trichet have said they could cut them again in December. Having raised rates as recently as July, ECB officials say fading inflation has paved the way for rates cuts as the euro zone faces the first recession in its ten year history. (Reuters)