Finance
Euro Zone Needs More ECB Stimulus, Policymaker Centeno Tells Paper
Published by Global Banking & Finance Review®
Posted on June 22, 2025
2 min readLast updated: January 23, 2026
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ECB's Mario Centeno urges more stimulus for the euro zone, citing weak economic conditions and the need for stable inflation.
ECB Policymaker Centeno Advocates for Additional Euro Zone Stimulus
MILAN (Reuters) -The euro zone economy is weak and needs "further stimulus" from the European Central Bank, ECB policymaker Mario Centeno said in an interview with the Italian daily La Stampa published on Sunday.
The ECB cut interest rates for the eighth time in a year earlier this month to support a sluggish recovery in the euro zone but clearly signalled a pause in July.
Centeno, whose term as Portugal's central bank governor ends before the ECB's next policy meeting on July 23-24, backed further rate cuts.
"The level of rates must be compatible with an economy that generates stable inflation at 2%. Today, in my opinion, that economy does not yet exist in the euro area," he told La Stampa.
"Supply and demand conditions are still too weak to allow a return to the target without further stimulus," added Centeno, who often favours easier monetary policy conditions.
"It's a decision that will be taken meeting by meeting. But it is essential to remember that, for the idea of a neutral rate to work, the price level and the state of the economy must be in balance. And today, the economy remains weak," he said.
(Reporting by Gianluca Semeraro; Editing by Hugh Lawson)
Key Takeaways
- •ECB policymaker Centeno advocates for more stimulus.
- •Euro zone economy remains weak, needing further support.
- •Interest rates have been cut eight times in a year.
- •Current economic conditions do not support 2% inflation.
- •Decisions on rates will be made on a meeting-by-meeting basis.
Frequently Asked Questions about Euro zone needs more ECB stimulus, policymaker Centeno tells paper
1What does Mario Centeno believe about the euro zone economy?
Mario Centeno believes that the euro zone economy is weak and requires further stimulus from the European Central Bank.
2What recent action did the ECB take regarding interest rates?
The ECB cut interest rates for the eighth time earlier this month to support a sluggish recovery in the euro zone.
3What is Centeno's view on the current inflation target?
Centeno stated that the economy in the euro area does not yet exist to generate stable inflation at the target of 2%.
4How does Centeno suggest the ECB should approach future decisions?
Centeno indicated that decisions regarding interest rates should be taken on a meeting-by-meeting basis, emphasizing the need for balance between the price level and the state of the economy.
5What is the significance of the neutral rate in Centeno's view?
Centeno mentioned that for the idea of a neutral rate to work, the price level and the state of the economy must be in balance, highlighting the importance of economic conditions.
