The European Central Bank on Thursday cut interest rates by a quarter of a percentage point, saying it expects inflation to fall back to its target later in the year and signaling that further easing is likely in coming months.

The central bank cut rates by a quarter point, as it rushes to brace a stagnant economy against President Trump’s threatened tariffs.

The European Central Bank cut rates on Thursday, the Bank of Canada on Wednesday, and the Bank of England is likely to do so next week.

The ECB (European Central Bank) continued policy normalisation today, with another 25 basis points (bps) worth of cuts across all three benchmark rates. This marks the fourth consecutive rate reduction, bringing the Deposit Facility Rate, the Refinancing Rate, and the Marginal Lending Facility Rate to 2.75%, 2.90%, and 3.15%, respectively.

European Central Bank President Christine Lagarde slapped down on Thursday a suggestion by her Czech colleague Ales Michl to include bitcoin among his country's official reserves.

Against this backdrop, the ECB’s communication in the policy statement and President Lagarde’s comments will hold the key to determining the scope and timing of the next rate cuts as the Bank battles concerns over economic growth and potential tariffs by United States (US) President Donald Trump’s administration.

European stock markets rose Thursday as the European Central Bank cut interest rates again while US shares were steady after a mixed bag of company earnings reports.

WASHINGTON - US President Donald Trump is getting his wish that interest rates drop across the world, just not at home where a strong economy and uncertainty over his own policies have set the stage for the Federal Reserve to diverge from its central bank peers.

The Fed kept rates steady at 4.25%-4.50%, signalling caution amid strong US growth and elevated inflation. Meanwhile, the ECB faces pressure to cut rates further as the eurozone economy weakens. The euro fell to 1.

KIRILL KUDRYAVTSEV / AFP The European Central Bank cut interest rates again Thursday, January 30, and signaled more to come as the eurozone economy flatlines while warning of trade tensions and uncertainty amid American President Donald Trump's protectionist agenda.

The ECB is expected to cut rates by 25bps to 2.75% on Thursday as inflation nears 2% and growth remains weak. Analysts see further cuts in 2025, but US trade tariffs could add uncertainty.