The European Central Bank cut interest rates, as US tariffs and declining business confidence have drained already weak economic growth.
The central bank has reduced the interest rate for the twenty Eurozone countries on deposits by 25 basis points to 2.25 percent.
He said that increasing uncertainty is likely to lead to a decline in confidence among households and businesses, and the market's negative and volatile reaction to trade tensions is likely to have an increasing impact on financing conditions.
This change comes at a time when interest rates have reached the maximum neutral rate for the European Central Bank, a level that neither constrains nor stimulates economic growth.
The bank had previously set this range between 1.75 percent and 2.25 percent, but policymakers downplayed the significance of these figures.
The President of the European Central Bank, Christine Lagarde, warned that the impact of tariffs could reduce growth in the Eurozone this year to half, compared to already modest expectations of 0.9 percent.
Lagarde recently stated that the European Central Bank remains alert and ready to take further action if necessary to ensure price stability and financial stability.
