Some senior officials of the European Central Bank said on Monday that if inflation stabilizes at the target level of 2% as expected, the ECB expects to further cut interest rates.

As concerns about economic weakness and high inflation fade, European Central Bank President Lagarde and the bank's most influential policy hawk Isabel Schnabel have consolidated their market bets that the eurozone will further gradually reduce borrowing costs.

If the upcoming data continues to confirm our baseline, then the direction forward is clear, and we expect to further lower interest rates, "Lagarde said in a speech

Eurozone inflation was 2.3% last month, and the European Central Bank expects it to stabilize at its target level of 2% next year.

Last week, the Eurozone central bank lowered its benchmark interest rate for the fourth time this year and removed the statement that maintaining interest rates was "strict enough," opening the door for further rate cuts.

After her speech on Monday, Lagarde said, "For those who want to know what this change in wording meant last week and what we will see in the near future, I hope the situation becomes clearer

Schnabel made it more clear later on Monday that the European Central Bank should continue to cut interest rates gradually until they reach a neutral level.

Price stability is just around the corner, and considering the risks and uncertainties we still face, gradually lowering policy rates to neutral levels is the most appropriate course of action, "Schnabel said at an event in Paris

Although the neutral interest rate is a vague concept, Schnabel believes that it should be between 2% and 3%. Lagarde once said that the European Central Bank's research suggests that the neutral interest rate should be between 1.75% and 2.5%.

This indicates that there may be several more cuts to the 3% deposit rate before the neutral rate debate escalates.

Financial investors expect the ECB to cut interest rates by 25 basis points in each of its next four meetings, but have currently shelved bets on a larger 50 basis point rate cut, which is in line with Schnabel's call for gradual progress.

Schnabel stated that the European Central Bank should not attempt to address structural issues in the eurozone, such as a lack of investment, by adopting an expansionary monetary policy, and implicitly criticized her predecessor for attempting to do so over the past decade.

She said, "In the 2010s... for a long time, a highly loose monetary policy stance was unable to free the economy from a low growth, low inflation environment. Structural policies are the responsibility of the government.