ECB Executive Board Member Benoit Coeure: ECB May Have to Accelerate Rate Cuts

On September 19th, Jin10 Data reported that Governor of the Central Bank of Portugal and member of the European Central Bank's executive board, Vitor Constancio, said in an interview with Politico that the European Central Bank may have to accelerate its interest rate cuts as data released since last week's rate cut showed that growth and inflation may fall below the European Central Bank's new forecasts. Given where we are in the monetary policy cycle, we really have to minimize the risks of interest rates falling below expectations, as this is the main risk, Constancio said. Constancio's comments are the clearest sign yet that a rate cut in October is still possible. The European Central Bank is struggling to address the question of how quickly to loosen policy in a situation where the economy is struggling to gain momentum but also difficult to curb inflation. European Central Bank President Lagarde hinted last week that no further action would be taken before December, when the European Central Bank cut interest rates for the second time this year. Although the ECB's chief economist, Lane, confirmed on Monday that decision-makers should reserve the option of a rate cut in October, hawks in the management committee stressed that significant changes would be needed to consider a continuous rate cut.