FRANKFURT—The European Central Bank reduced its key interest rate to the lowest level since early 2023, and signaled it is nearing the end of its rate-cutting cycle as inflation abates.The ECB on Thursday cut its deposit rate to 2% from 2.

The European Central Bank cut interest rates Thursday, putting the body further ahead of its U.S. counterpart in moving toward a less restrictive monetary policy—likely to the chagrin of President Donald Trump.

Federal Reserve Governor Christopher Waller said on Monday that interest rate cuts remain possible later this year even with the Trump administration's tariffs likely to push up price pressures temporarily.