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The European Central Bank has reduced the standard interest rate by a quarter of a point to 2.5 percent, indicating a possible slowdown in borrowing costs.

The expected step on Thursday is the sixth reduction in European Central BankThe deposit price since the central bank began the price cutting course last June, when this standard reached a record number 4 percent higher to meet the increasing inflation.

In changing the tone that indicates a more honest situation, the European Central Bank said that “monetary policy has become less restricted.”

The language suggested a possible slowdown or a temporary stop in future interest rate discounts, as it is compared to the previous formulation of the European Central Bank that “monetary policy remains restricted.”

Christine Lagarde, President of the European Central Bank, said the new formulation “is not a harmful, harmful change”, but it is meaningful.

In the wake of the direct decision, traders reduced their bets on future price discounts.

While they fully priced in reducing another quarter of a point this year, according to the levels involved in the bombing markets, the second reduction opportunity in 2025 decreased from about 85 percent to approximately 65 percent.

The euro rose against the dollar after the European Central Bank’s decision, an increase of 0.4 percent to $ 1.083.

“The direction of traveling at the European Central Bank is no longer clear.”

Economic inflation It decreased from the peak of 10.6 percent in October 2022 to 2.4 percent in February, and the deposit rate is now its lowest level since February 2023.

Horizons Economy of the euro area It can also be affected by the movements made by Fredesh Mirz, a consultant in Germany, to launch hundreds of billions of euros in borrowing to enhance defensive spending and repair his country’s infrastructure.

Some analysts expect that the plans have doubled Germany’s expected growth next year to 2 percent.

The German debt, the eurozone index, was not affected by the European Central Bank’s decision, after a sharp sale after the announcement of historical stimulation in the country. The package revenue for ten years was 0.07 percentage points at 2.86 percent.

In expectations that did not take into account the Mirz announcement this week, the European Central Bank reduced its growth expectations for 2025 – its sixth consecutive reduction for this year – as well as for 2026 and 2027.

It is now expected to increase the gross domestic product of the euro area by only 0.9 percent this year, compared to its drop -off of 1.1 percent.

Lagarde said on Thursday afternoon: “The high uncertainty at home and abroad hinders the challenges of investment and competitiveness on exports.” The growth last year was 0.7 percent slow.

But Lagarde added that “increased spending on defense and infrastructure can also add growth” and “can raise inflation through its effects on total demand.”

Before the European Central Bank’s decision, economists in Goldman Sachs wrote in a memorandum to customers that the batch of Germany’s debts for much higher defensive spending and investment in infrastructure “clearly reduces pressure” until the European Central Bank reduces interest rates from 2 percent.

The European Central Bank raised its expectations for inflation this year from its estimation in December of 2.1 percent to 2.3 percent against the backdrop of high energy prices.

He added that “most of the basic inflation measures” indicate that it appears on the right track to achieve its goal by 2 percent.

Puja Kumra, a rate strategy in TD Securities, said that the European Central Bank is definitely more cautious “in future discounts, as it hinted at US President Donald Trump’s tariff for the European Union.

With uncertainty about finance [policy] “The definitions cannot adhere to any path,” she said.