Growth concerns have caused European Central Bank policymakers to split on the necessity of implementing jumbo rate cuts.

• The European Central Bank's policymakers are divided on whether to cut interest rates by half a point in December, despite the presence of downside risks to both economic growth and inflation.
• The ECB made history by cutting interest rates twice in a row at its October meeting.
• Austrian central bank Governor Robert Holzmann stated on Wednesday that he is certain some of his colleagues will opt for a significant reduction, while others will not. Personally, he will claim that he will examine the data before making a decision.

The European Central Bank's policymakers are divided on whether to cut interest rates by half a point in December, despite the presence of downside risks to both economic growth and inflation.

The ECB made history by cutting interest rates twice in a row at its October meeting.

The central bank's third quarter-point cut this year had been fully priced in by markets after decision-makers flagged reduced inflation risks and a weakening growth outlook.

According to Mario Centeno, the Portuguese central bank chief, the inflation rate in September was significantly lower than anticipated.

"Centeno stated that we must incorporate that into our narrative. Following that, we must examine the incoming data, the trend in the data we have been monitoring, and it is likely that 50 basis points will be considered because we remain data-dependent and the data we are receiving indicates this direction."

The inflation rate in the euro zone was recently adjusted to 1.7% in September, which is lower than the previously estimated 1.8%. This is in contrast to the 2.2% recorded in August.

Since June 2021, the euro zone's inflation rate has not fallen below the ECB's 2% target until September 2021, signaling the end of years of high price growth and increasing the likelihood of near-term rate cuts.

Knot, a member of the Dutch European Central Bank Governing Council, stated that a half-point interest rate cut at the ECB's December meeting could not be ruled out. However, he emphasized that such a move would necessitate some deterioration in the data.

Knot stated on CNBC on Wednesday that he believes we will achieve our 2% inflation target with confidence, somewhere in the next year.

He added that he saw the risks surrounding the baseline as reasonably contained.

"If the December projections confirm the scenario and we continue to cut rates, we will gradually remove our foot from the brake until we reach neutral territory, where we won't simulate or slow down the economy anymore."

'Look at the data'

Last week, Christine Lagarde, ECB President, stated that the central bank's policymakers only discussed a 25-basis point cut at the meeting, rather than a larger 50-basis point reduction.

Austrian central bank Governor Robert Holzmann stated on Wednesday that he is certain some of his colleagues will opt for a significant reduction, while others will not. Personally, he will claim that he will examine the data before making a decision.

Although Holzmann believes that policymakers may argue for a larger interest rate cut in December, he considers the ECB's recent quarter-point move as a "precautionary" step, and it is possible that the central bank will maintain its position at the end of the year.

"If things really get as bad as some claim, we can have another 25, but I would say at the moment with the data, no," Holzmann said.

The ECB has consistently stated that inflation is expected to increase in the near future, eventually reaching the target level by the end of the year.

Inflation is decreasing in several high-income countries, prompting several major central banks to loosen monetary policy.

While the global fight against inflation is "almost won," the downside risks are "increasing and now dominate the outlook," according to the International Monetary Fund.

— CNBC's Jenni Reid contributed to this report.