Interview with Isabel Schnabel, Member of the Executive Board of the ECB, conducted by Steffen Clement on 16 May 2024

24 May 2024

On 6 June the Governing Council of the European Central Bank (ECB) will next decide on the level of interest rates. Will it be the beginning of a rate turnaround?

Every decision is made on the day of the Governing Council meeting on the basis of all the information available at the time. There are still quite a lot of data we haven’t received yet. So the decision won’t be made until the day the Governing Council meets. If the inflation outlook and the new data give us confidence that inflation will sustainably converge towards our target of 2%, a rate cut in June will be likely.

What impact do you expect on savers and borrowers?

When a rate cut is widely expected, market prices adjust in advance. This means that when an interest rate decision meets general expectations, probably nothing will change because the move has been priced in already. If you take…