Isabel Schnabel, a member of the European Central Bank's Executive Board, expressed concerns about further interest rate cuts, stating that current borrowing costs are already at a level that does not impede economic growth.
She emphasized the potential risks of lowering rates too much, which could have negative consequences for the economy. Schnabel suggested that while there is room for continued monetary policy easing, it should be done gradually to avoid going below the neutral threshold.
The policymaker cautioned that excessive easing could deplete valuable policy space and potentially undermine future economic stability.