According to Jinshi Data, Capital Economics economist Palmas said that the possibility of the European Central Bank cutting interest rates again next month is increasing. Palmas pointed out that the cooling of inflation in France and Spain this month exceeded expectations, indicating that core inflation has eased.
Data next week will show that overall inflation in the euro zone is likely to fall below the ECB's 2% target, she said. That might not be enough to prompt rate setters to cut the ECB's key interest rate for a second straight time, but that scenario is more likely now than before.
