The European Central Bank (ECB) has reduced its key interest rate to 2%, marking the eighth cut in just over a year. This decision comes as the ECB expresses concerns about the impact of U.S. tariffs on the eurozone economy. While inflation has eased, economic growth remains sluggish. The ECB anticipates that uncertainty surrounding trade policies will affect business investment and exports. Meanwhile, the EU has prepared retaliatory tariffs on $21 billion worth of U.S. goods. Despite near-term challenges, the ECB projects medium-term economic acceleration due to increased European spending on defense and infrastructure. ECB President Christine Lagarde emphasized the importance of household spending to bolster economic resilience. Official U.S. employment statistics are expected on Friday, with forecasts suggesting a slight slowdown in job additions.
— new from BBC
