Edin Mujagic

Falling inflation and the European Central Bank’s (ECB) conviction that price increases will stabilize around two percent annually in the long run made it possible for Frankfurt to announce another rate cut earlier this month. With this move, the policy rate has now been more than halved compared to the summer of 2024. The ECB seems to be casting out the interest rate anchor and allowing itself to drift for a while.

The U.S. dollar is taking a beating. I’m not just referring to its exchange rate, but also to the growing doubts being raised about the role the greenback plays on the global stage as the de facto world currency.

It was March 2015 when Otmar Issing, an early board member of the ECB and the bank’s former chief economist, poured me a cup of coffee. Like two war veterans, we sat on the 60th floor of the Messeturm in Frankfurt, gazing out at the smoke plumes marring the city’s skyline. Issing had seen something like it before—just as I had.

The monetary forest through which Christine Lagarde and the rest of the ECB are wandering appears to have only one path. During the latest press conference, the ECB President made it clear that the direction of the bank’s interest rate journey is downward.

The ECB drifts from its core mission, embracing politics over monetary policy—what does this mean for Europe’s future? Edin Mujagić breaks it down.

The governing council of the European Central Bank (ECB) lowered interest rates again in October. The bank expects annual inflation in 2026 to reach 1.9 percent, which would align with the ECB’s target of 2 percent annual price increases.

Naturally, the interest rate decision and everything surrounding it took centre stage earlier this month when the European Central Bank (ECB) board met in Frankfurt. And of course, questions during the press conference focused on what we can expect in the coming quarters. Like many others, I was tuned in, eager for insights.

It might seem like Europe has its financial house in better order than the United States. But hold on a moment — this might just be an optical illusion!

The ECB decision to cut interest rates in June was not only perplexing but also premature, writes ECB-watcher Edin Mujagic.

Data-dependent, that was perhaps the word we heard most often from the president of the European Central Bank (ECB) in recent months.