Prime Minister António Costa announced this Thursday in Brussels two “good news” from the European Central Bank (ECB), namely the recognition of lower inflation and the preservation of interest rates.
Speaking of “double good news”, the Prime Minister emphasized that “the first is that the ECB recognizes that there is a strong trend towards lower inflation” and secondly that the central bank has decided “not to raise interest rates any further”. “
Maintaining interest rates, Portugal’s chief executive stressed, “is a good principle” so that the debate that European Union leaders will hold on Friday with ECB President Christine Lagarde can take place “in a different climate.” from what has been done so far.”
“I think this is a good sign and it builds confidence in the future of the economy,” he also said, adding that he hopes “this pause will be one that precedes a gradual reduction in interest rates.”
Antonio Costa also recalled that a year ago the interest rate was about 10%, but now it has begun to decline to the current 3.6%.
On the other hand, the government leader said that at the moment there is another “very important” issue from an economic point of view: the question of the necessary agreement by the end of the year on the rules of EU economic governance.
“They have been suspended since the beginning of the pandemic, and if there is no agreement, they will begin to apply in January,” he recalled, adding that a group of countries, including Germany, “are unlikely to be able to comply with the requirements.” with them”.
EU leaders will meet this Thursday and Friday in Brussels to discuss tensions in the Middle East, the push for a humanitarian pause in Gaza and talks on a two-state solution, as well as European issues such as migration, security and budgetary issues.
At a geopolitical level, Russia’s invasion of Ukraine will also be discussed, with Ukrainian President Volodymyr Zelensky taking part in a video conference at the start of the summit as the EU considers how to use Russia’s frozen assets to finance Ukraine’s reconstruction.
A eurozone summit with Lagarde is scheduled for Friday.
The ECB announced this Thursday that it has left interest rates unchanged, which is the first time since July 2022.
The pause comes after 10 consecutive interest rate hikes and at a time when inflation is showing signs of slowing.
Author: Lusa
Source: CM Jornal
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