European Central Bank Executive Paneta: There is no need to be reserved on interest rate cuts

According to a report by Golden Jubilee, European Central Bank Executive Director Leon Panetta stated that there is no need to hold back on interest rate cuts, as the 2% price target is imminent and inflation risks are also decreasing. Therefore, there is no need to postpone interest rate cuts. On Saturday, Panetta said, "Monetary policy continues to exert downward pressure on economic activity and inflation. With inflation approaching the target and domestic demand remaining weak, this impact is becoming increasingly unnecessary. Relaxing monetary policy less decisively may lead to low inflation in the medium term." Panetta also stated that borrowing costs are approaching neutral interest rates, which will neither limit nor stimulate the economy. He believes that the downside risk of inflation is greater than the upside risk. The imposition of tariffs by the United States on European exports may have little impact on inflation in the eurozone, with the main risk still being a mid-term inflation rate falling below 2%. He also called for policy decisions to receive communication support that focuses on the real economy and the medium-term outlook for inflation. Panetta believes that the main threat to price trends comes from the energy market. In the context of increased volatility, energy market prices, especially natural gas prices, are rising and require close monitoring.