Following Canada's rate cut, the European Central Bank also cut interest rates for the first time in five years. Another G7 member country cut interest rates. The European Central Bank cut interest rates from 4.5% to 4.25%, a decrease of 25 basis points, announcing the official start of a rate cut cycle. Unlike Canada's dovish remarks, the European Central Bank was obviously reserved. It did not commit to any specific interest rate path in advance, and said that it would maintain a sufficiently restrictive level as long as necessary. Lagarde also said: It cannot be said that we are entering a phase of rate cuts, and inflation will fall to the target level in the second half of next year.