According to the latest reports, Slovenia's Central Bank acting president Primož Dolenc stated in a media interview that the European Central Bank's interest rate cut cycle has likely officially come to an end. This view has sparked widespread attention in the financial markets.

Although Loretta Mester does not have voting rights, she participated in the European Central Bank's Governing Council meeting in July this year. She revealed that there was a broad consensus at the meeting to end the easing policy and enter a period of observation. Since then, no significant changes have occurred that would alter this position. She believes that the current interest rate level is sufficient to support the future achievement of inflation targets.

Looking back at the policy trajectory of the European Central Bank, since the beginning of the interest rate cut cycle in June 2024, the deposit rate has been cumulatively reduced by 100 basis points to 3.0%. In July of this year, the European Central Bank first paused the interest rate cuts, maintaining the rate unchanged, which at the time sparked numerous speculations in the market regarding the direction of monetary policy. The latest statement from Dorenze further reinforces the signal that the interest rate cut cycle may have already ended.

Dolan's judgment is based on several factors: first, the inflation rate in the Eurozone is close to the 2% target, confirming the effectiveness of previous interest rate cuts; second, the Eurozone economy shows a certain degree of resilience; finally, although the newly reached trade agreement between the EU and the US imposes a 15% tariff on most EU products (higher than the expectations in June), it eliminates long-term uncertainty in trade policy. Dolan believes that this agreement will not have a significant impact on the Eurozone's economy and inflation expectations.

However, the market remains divided on the future policy direction of the European Central Bank. Some viewpoints support the stance of Dorenze, arguing that current interest rates should remain stable to observe economic data and promote sustainable development. Other viewpoints point out that, given the complexity of the global economy and the imbalances in the developments within the Eurozone, it cannot be ruled out that the European Central Bank may reconsider interest rate cuts or take other stimulus measures in the future based on actual circumstances.

This policy direction will have a profound impact on the global financial markets, especially on the Eurozone economy. Investors and policymakers will closely follow the future decisions of the European Central Bank, as well as their effects on economic growth, inflation, and employment.