By Paul Hannon
The outlook for the eurozone economy is increasingly uncertain amid growing threats to international trade, while inflation will ease next year after a brief rise, European Central Bank President Christine Lagarde said Wednesday.
The eurozone economy grew more rapidly than expected in the three months through September, but Lagarde said recent surveys pointed to a slowdown. Further head, the outlook is increasingly uncertain, given the threat of higher tariffs on U.S. imports from the currency area.
"The medium-term economic outlook is uncertain and dominated by downside risks," she told lawmakers in the European parliament. "Geopolitical risks are elevated, with growing threats to international trade."
Lagarde said that while consumer prices have been rising at a slightly faster pace in the final months of this year, inflation is set to cool in 2025.
At their October gathering, ECB policy makers cut their key interest rate for the third meeting since June. Many investors expected them to lower borrowing costs by another quarter of a percentage point when they meet next week, while some expect to see a larger move.
Lagarde said a number of outcomes are possible.
"We will review our stance again next week, following our data-dependent and meeting-by-meeting approach," she said. "We are therefore not pre-committing to a particular rate path."
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
12-04-24 0910ET
