Interview with Piero Cipollone, Member of the Executive Board of the ECB, conducted by Andrés Stumpf

24 March 2025

The last ECB Governing Council meeting left the door open for a pause in interest rate cuts, or even stopping them all together. Would you be OK with rates remaining at their current level of 2.5%?

At the time of our March meeting, markets were pricing in a reduction in interest rates over the coming months, including going below 2%, with rates stabilising around that level. To produce our macroeconomic projections we take as given the rate path being priced in by markets and, despite rates being on a downward trajectory, the projections showed inflation converging towards our target at the beginning of 2026, with slightly weaker growth.

Since then, not only has this narrative been confirmed, but key issues have arisen that have strengthened the arguments in favour of continuing to lower rates. First, energy prices have fallen significantly. The upward revision to…