European Central Bank policymaker Mario Centeno said on Friday he expects inflation to fall to its medium-term target of 2% in a sustainable manner since euro zone inflation is "almost out of the woods".
European stocks were trading in the red Thursday as investors waited for the latest policy decision from the continent's central bank. The flagship Stoxx 600 index fell 0.7% in morning trading. London's FTSE 100 dropped 1.
Although the ECB would not pre-commit to future rate cuts, the fact that Christine Lagarde did not push back on lower rate cut expectations is a sign that the ECB is comfortable with a neutral rate around 2%.