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State of the Union: Low interest rates and food challenges

President of European Central Bank Christine Lagarde attends a press conference after a meeting of the ECB's governing council in Frankfurt
President of European Central Bank Christine Lagarde attends a press conference after a meeting of the ECB's governing council in Frankfurt Copyright Michael Probst/Copyright 2024 The AP. All rights reserved
Copyright Michael Probst/Copyright 2024 The AP. All rights reserved
By Isabel Marques da Silva
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The European Central Bank's "historic" interest rate cut and the European Union's food challenges - both in agricultural production and food waste - are this week's top topics.

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The most recent inflationary crisis began in 2022, following Russia's full-scale invasion of Ukraine, with the EU's harmonized consumer price index peaking at 10.6% in October 2022.

In response, the European Central Bank (ECB) began raising interest rates, putting households and businesses under pressure due to the high value of their bank payments.

Two years later, inflation in the euro zone has fallen to 2.6% - close to the 2% considered the ideal rate -, which is why the ECB made an announcement that should bring relief.

The reduction in interest rates by 25 basis points was explained by its president, Christine Lagarde, as a prudent decision given the risks that still exist.

"We are determined to ensure that inflation returns to our 2% medium-term target in a timely manner. We will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim," she told a press conference.

Farmers protest again

“Warrior farmers” is what participants in a demonstration this week in Brussels called themselves. They are dissatisfied with the recent changes introduced to the Common Agricultural Policy (CAP) to respond to the wave of protests that has lasted for half a year.

The protest was called by agricultural organisations close to the far right, and included speakers belonging to these parties from Poland, Belgium and the Netherlands, for example. Copa-Cogeca, the main federation of European farmers, did not participate.

However, the organisers rejected this association, with Sieta van Keimpema of the Farmers Defence Force saying "this is a lie we have heard repeatedly. There is no politics in this protest and there is nothing extreme except people lying".

It is essential to produce quality food at a fair price, but also to avoid food waste, which is equivalent to 20% of what is purchased by consumers. Food waste has a significant environmental impact in terms of land and water use, but also in terms of polluting gas emissions that affect the climate.

To discuss solutions, the European Commission this week hosted the European Forum on Consumer Food Waste, with researchers and other professionals including Christophe Diercxsens, director of Public Affairs at social impact company Too Good To Go.

“The European Commission has put on the table a proposal to introduce legally binding targets for reducing food waste in the EU, which is currently being negotiated in the EU institutions,” he explained to Euronews.

“At the consumer level, it is important to have more educational campaigns so that there is a new respect for food and also to use a little common sense with certain practices. So, learning to cook with surplus ingredients, for example, having leftovers from the day, for example," he added.

(Watch the full programme in the video player above)

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