ECB Rate Cuts Will Continue Next Year, Vujcic Tells HRT1

(Bloomberg) — The European Central Bank will continue to reduce borrowing costs in 2025, according to Governing Council member Boris Vujicic.

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“The direction is clear, it’s a continuation of the direction from 2024, and it’s a further decrease in interest rates,” the head of the Croatian central bank said in an interview with state broadcaster HRT1 on Saturday.

Last week, the ECB cut the deposit rate by a quarter of a point to 3%, the fourth such move since June.Officials said more steps would follow, although they differed on how many would be needed.

“I don’t know to what point” the ECB will cut interest rates, Vujicic said. “It will be determined by the data, first of all by the rate of inflation, by our forecasts, will it decrease, and we will see the impact of monetary policy transmission and our forecasts.”

One point of uncertainty weighing on the outlook is the threat of tariffs after Donald Trump returns to the White House next month.

“If a trade war breaks out, it will be bad for growth in Europe and the rest of the world,” Vujicic said, adding that trade wars usually drive up prices “.

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