10 December 2024
The European Central Bank (ECB) is set to implement its fourth consecutive interest rate cut this week, but officials are divided on how much these reductions can stimulate the eurozone’s struggling economy. While some policymakers advocate for rapid cuts to boost consumer spending and business investment, others are more cautious, arguing that structural issues like high energy costs and labor shortages are beyond monetary policy’s scope. The outcome of this debate will influence the extent of the ECB’s easing campaign and its potential to stimulate economic activity.