OENB boss Holzmann warns: No interest rate reduction for stable economy!

OENB boss Holzmann warns: No interest rate reduction for stable economy!

Vienna, Österreich - On April 2, 2025, OENB boss Robert Holzmann commented on the current key interest interest in the European Central Bank (ECB) and was skeptical about another interest rate reduction. According to Holzmann, the current interest rates are already in a neutral area that no longer negatively affects economic growth in the euro area. This is an important point because the ECB is in a continuing fight against inflation.

Holzmann pointed out that the inflation rate in the euro zone in March 2025 dropped to 2.2 percent after it was still 2.3 percent in February. He emphasized that monetary policy should no longer be accommodating because inflation is in a decreasing trend. This could possibly have an impact on the decisions of the ECB with regard to interest rate policy.

Risk of stimulation

Holzmann, who was the only one during the interest session in March 2025 who did not give approval to reduce interest, for caution. He warned that it was not necessary to stimulate the economy in addition. Since June 2024, a possible interest rate reduction by 0.25 percentage points would be the seventh adaptation in this regard. The financial market estimates the likelihood of such a reduction to around 80 percent.

A reduction in the deposit rate in the euro area would reduce it to 2.25 percent. "Inflation is on the right track," says Holzmann. The ECB strives for an inflation of 2.0 percent as an ideal value to ensure a stable economic environment.

outlook on the next interest session

The next decisive interest rate from the ECB is on April 17, 2025. It remains to be seen whether the decisions made there will confirm Holzmann's assessments or indicate a different monetary policy. In any case, the current Situation not only reflects the ECB's efforts to control inflation, but also the complex balancing act that is necessary so as not to endanger economic growth. Further information can be found on the official EZB-Website .