The European Central Bank should use bond purchases more sparingly in the future given costly side effects, Dutch central bank chief Klaas Knot said on Friday just as the ECB is starting a strategy review.

Euro zone inflation will be back at the European Central Bank's 2% target by the summer and interest rates could keep on falling to support the economy, French central bank chief Francois Villeroy de Galhau said just a day after the ECB's fourth straight rate cut.

Germany’s inflation rate declined unexpectedly this month, though remains above the target of the European Central Bank, which this week cut its key interest rate. Consumer prices were 2.3% higher in January than the first month of 2024,

Diverging signals about monetary policy from the European Central Bank and Federal Reserve this week have set the euro on a clear path for further weakness.

The European Central Bank may stop describing its monetary policy stance as “restrictive” at its next decision in March, according to people familiar with the Governing Council’s debate.

Despite still elevated domestic inflation, weak growth and inflation projected at target this year strengthen the case for further rate cuts.

The ECB is expected to cut rates by 25bps to 2.75% on Thursday as inflation nears 2% and growth remains weak. Analysts see further cuts in 2025, but US trade tariffs could add uncertainty.

ECB cuts the deposit rate by a quarter point to 2.75 per cent as expected and offers little shift in tone from December as it continues to move policy away from restrictive territory

US President Donald Trump is getting his wish that interest rates drop across the world, just not at home, where a strong economy and uncertainty over his own policies have set the stage for the Federal Reserve to diverge from its central bank peers.

Major stock markets rose Friday, as a key US inflation reading met expectations and strong results from Apple reassured investors that the tech sector is still healthy after a turbulent week. AI-related stocks,

Germany's annual inflation rate held steady in January but core inflation eased markedly, keeping intact expectations of further interest rate cuts from the European Central Bank. German inflation remained at 2.