After the conclusion of the Monetary Policy Committee meeting on Thursday, the European Central Bank decided to cut interest rates at a pace that aligned with market expectations, by 25 basis points for the fifth consecutive time, bringing the main refinancing rate to 2.90%, following the bank's previous decision to lower the main interest rates in the Eurozone at the last meeting to 3.15%. The deposit rate was also reduced by 25 basis points to 2.75%.
A monetary policy statement from the European Central Bank is set to be released shortly, providing more detailed explanations regarding the economic situation in the Eurozone. This statement will be followed by a press conference held by the ECB President, Christine Lagarde, to comment on the interest rate decision and the monetary policy statement, in less than 30 minutes from now.
Short-term interest rates are considered the primary factor influencing the value of a currency, as investors look for other indicators to predict potential changes in interest rates in the future, especially since the main goal of the monetary policy followed by the European Central Bank is to achieve price stability. If the ECB's inflation outlook is positive and interest rates are raised, it is seen as positive for the euro, while a rate cut is viewed as negative for the euro currency.
