The ECB announced on Thursday that it would cut interest rates for the third time this year in response to weak economic growth. The already rock-solid labor market has weakened and relieved pressure on consumer prices. However, the bank has provided no new clues about its next steps. Even if the market is expected to cut interest rates similarly at the next three meetings, reducing interest rates from a level that limits growth to at least a neutral level by the end of next year. Given that inflation is likely to rise in the next few months, hawkish officials may still oppose a quick rate cut. However, dovish figures believe that growth is so weak now that unless the ECB acts quickly to support the Eurozone, inflation may actually fall below the target level, and the ECB will have to shift from fighting rapid price growth to too low inflation. The debate is unlikely to be resolved on Thursday, and Governor Lagarde's press conference probably won't offer any promises.

The ECB announced on Thursday that it would cut interest rates for the third time this year in response to weak economic growth. The already rock-solid labor market has weakened and relieved pressure on consumer prices. However, the bank has provided no new clues about its next steps. Even if the market is expected to cut interest rates similarly at the next three meetings, reducing interest rates from a level that limits growth to at least a neutral level by the end of next year. Given that inflation is likely to rise in the next few months, hawkish officials may still oppose a quick rate cut. However, dovish figures believe that growth is so weak now that unless the ECB acts quickly to support the Eurozone, inflation may actually fall below the target level, and the ECB will have to shift from fighting rapid price growth to too low inflation. The debate is unlikely to be resolved on Thursday, and Governor Lagarde's press conference probably won't offer any promises.