ECB's Kazaks noted that rate-cutting cycle is nearing its end

The European Central Bank (ECB) Governing Council Member Martins Kazaks, analyzing the eurozone inflation outlook, suggested during a CNBC interview that the rate-cutting cycle may be nearing completion. He noted that if current trends toward returning inflation to the 2% target by year-end persist, further rate reductions could remain limited.

Assessing economic prospects, Kazaks suggested the possibility of a few more cuts from the current 2.25% deposit rate. However, emphasizing high uncertainty in global trade, he stressed there was no need to rush the decision. Warning of risks, the Governing Council member expressed concern about the potential for shallow, short-lived recessions in some eurozone countries.

As Bloomberg reports, recently released Eurostat data showing Eurozone economic growth slowed to 0.3% in the first quarter has heightened concerns about the region's economic outlook. Investors anticipating another rate cut in June link this potential move to slowing inflation and the impact of trade tariffs on the regional economy.