The data on the course of inflation in the eurozone in November will be announced on Friday by Eurostat and are expected to determine the level of interest rate cuts by the European Central Bank (ECB) at the meeting on December 12.
Speaking to ERTNEWS, the governor of the Bank of Greece (BoG) Yannis Stournaras believes that the most likely scenario is for the ECB to proceed with a new interest rate cut by 25 basis points in December.
However, he did not rule out the possibility that the reduction will be even greater, by 50 basis points. He described the scenario of the ECB keeping interest rates unchanged as extreme.
Tariffs lead to uncharted waters
The new US President Donald Trump announced that when he takes office in January he will proceed with the imposition of tariffs on Mexico, China and Canada. Responding to the possibility of taking a similar move in Europe, Stournaras emphasized that it would be a very negative scenario as then the global economy would “enter uncharted waters.”
In such a case and if it is determined that the eurozone is facing a recession, Yannis Stournaras stated that the ECB could proceed with a more aggressive policy of reducing interest rates.
Towards increasing the transaction limit through IRIS
The Governor of the Bank of Greece left open the possibility of increasing the transaction limit through the IRIS payment system, which currently stands at 500 euros. “It could certainly be increased. It is something that we are looking at. IRIS is a successful system, we do not need another system. We have invested in it, it is going very well, so we need to see its problems and fix them, expand it and make it a national payment system.”
Facilitating the digital euro
Regarding the implementation of the digital euro, he noted that it would facilitate central banks in unifying national payment systems.
