European Central Bank committee member Knot: Expected to gradually lower interest rates before the first half of 2025.

European Central Bank Governing Council member and President of the Dutch Central Bank Klaas Knot said on Tuesday that he expects interest rates to be gradually lowered in the "near future" and in the first half of next year. He believes that interest rates will not return to the extremely low levels before the pandemic, but will stabilize at a "more natural level" around 2%. Before making the above comments, the European Central Bank earlier this month reduced borrowing costs to 3.5%, marking the second rate cut this year. Some policymakers have hinted that the possibility of another rate cut in October is unlikely if the economic situation in the euro area does not deteriorate significantly. The market is betting that the European Central Bank will cut rates again in December, with roughly equal chances of a rate cut next month. Knot expressed optimism last week about investors betting on further rate cuts. Knot said on Tuesday, "European interest rates will continue to fall, as we increasingly believe that the 2% inflation target is achievable." He also added that he does not know when the rate cuts will stop.