The European Central Bank cut its benchmark interest rate by a quarter point to 2.5% on Thursday as inflation nears 2% and growth remains weak. View on euronews

Euro zone inflation dipped a bit less than expected last month but its most closely watched component also dropped, sealing the case for another ECB interest rate cut on Thursday and solidifying bets for further policy easing in the coming months.

FRANKFURT — The European Central Bank cut its key deposit rate by 25 basis points to 2.50 percent, but signalled that it may soon have to take a more cautious approach to easing policy as the eurozone economy heads into the great unknown.

Inflation in Europe eased to 2.4% in February, supporting the case for another interest rate cut from the European Central Bank but leaving open how far the central bank will go in lowering borrowing costs.

For four years, the ECB has been trying to slow the economy down, raising its key deposit rate to a record 4 percent to choke off inflation, before gradually lifting its foot off the brake since June. Next week’s expected rate cut will be the sixth in the current sequence, and will bring the deposit rate down to 2.5 percent.