Some reports indicated Reuters that ECB policymakers are increasingly divided on the growth prospects of the eurozone, and this emerging disagreement may significantly affect the discussions on cutting interest rates in the coming months.
Some policymakers are shifting their focus towards the risks of recession, while others remain steadfast in prioritizing the battle against inflation.
Although an interest rate cut this month seems certain, what will happen next remains uncertain.
Sources indicate that future decisions are expected to become more complex, as private discussions reveal divergent opinions among policymakers.
Doves who are considered a minority within the ECB claim that the economy is weaker than previously thought, which may accelerate a more severe economic slowdown, as they believe that the ECB may be late in implementing interest rate cuts to protect the economy.
On the other hand, hawks inside the bank insist that policy must remain tight until the inflation target is achieved, and they warn that rushing to ease policy before that date, which could delay significant interest rate cuts until 2026, could damage the credibility of the ECB.
The forecast suggests that while the September interest rate cut is highly certain, the outlook for October is still uncertain.
This may prompt ECB President Christine Lagarde to maintain a cautious stance in the upcoming announcement, with the ECB's approach remaining the same and stating that monetary policy will be determined by one meeting after another.
