ECB’s Centeno sees further gradual rate easing in coming quarters

LISBON (Reuters) – European Central Bank policymaker Mario Centeno predicted on Friday further gradual interest rate cuts in the coming quarters to ease what remains a ‘restrictive rate level’ to around 2%.

He said Thursday’s decision to cut the ECB’s key rate by 0.25 percentage points to 3% was ‘fortunately absolutely consensual’.

“In the future, the expectation is that the restrictiveness of interest rates will be reduced,” Centeno, who is also governor of the Bank of Portugal, told a briefing, adding that monetary policy should be normalised in a few quarters’ time, with rates close to 2%, if no new shocks materialise.

The ECB cut the key deposit rate for the fourth time this year on Thursday, and kept the door open to more easing as the euro zone economy is dragged down by political instability at home and the threat of a fresh U.S. trade war.