Meanwhile the ECB's survey of 19,000 euro area consumers showed a similar uptick in expectations last month. Median expectations for inflation over the next 12 months increased for the third month in a row, to 2.8% from 2.6%. However, three years out, expectations were unchanged at 2.4%.

Euro zone manufacturers are more worried about cheap imports from China than tariffs from the United States, a European Central Bank survey showed on Friday.

The European Central Bank lowered borrowing costs for a fifth time since June and while policymakers are confident the 2% inflation target is in reach, they are concerned about the euro zone’s stalling economy.

The European Central Bank (ECB) announced today a 25-basis-point interest rate cut, marking its fifth reduction since the bank began easing monetary policy in June last year.With this adjustment, the ECB's deposit facility rate—the bank’s main interest rate—now stands at 2.

The European Central Bank cut interest rates on Thursday and policymakers guided for a further reduction in March as concerns over lacklustre economic growth supersede worries about persistent inflation.