Ella 
According to Reuters, Klaas Knot, a member of the European Central Bank (ECB) Governing Council and President of Dutch Bank (DNB), said late on Monday that the euro zone inflation rate is falling towards the 2% target. Political tensions pose a slight threat to inflation, but the European Central Bank should still proceed with caution after cutting interest rates in June.
Key quotes
I am increasingly confident about the deflationary process.
Eurozone inflation is falling towards 2%.
Geopolitical pressures pose only modest risks to inflation.
If price and wage data continue to be in line with forecasts, a rate cut in June is still possible.
After June, I would say “not pre-committing to any specific time path”
After June, we will have to take a cautious approach.
Each quarter, we add a data target on the labor market to a new round of forecasts, which will be important information for us to readjust policy settings.
The experience of the United States over the past three months reminds us that we should remain vigilant.
It is likely that the conditions for a policy readjustment will be established only during 2025.
