Europe likely to lower rates ahead of Fed: ECB's Holzmann

Lowering key interest rate: The European Central Bank is likely to bring down its key interest rate ahead of the US Federal Reserve, according to ECB Governing Council member Robert Holzmann.

"Europe could cut interest rates before the US," Holzmann was quoted in Austrian newspaper Kronen Zeitung, as he observed that the European economy was growing at a slower rate than its US counterpart.

Austrian National Bank governor Holzmann, who is 75 years of age, also informed in the interview that he would not go forward for a second term as the top boss of the country's central bank. He is in service for his term till the end of August 2025.

Holzmann said the timing of rate cuts was still under discussion with the ECB’s Governing Council.
"From today's perspective, I'd say: interest rate cuts are likely to come. When will depend largely on what wage and price developments look like by June," he added.

There would be more scope to lower borrowing costs if the wage agreements in Europe were lower, Holzmann said.

(With Reuters Inputs)