The world’s advanced economies may have a new reason to hope for a firmer growth base next year if some of the more bearish forecasts for oil come true.

As Bloomberg reports, with global benchmark Brent crude retreating below $70 a barrel for the first time since late 2021, a key component of the energy shock that led to the worst inflation crisis in a generation is likely seen as enough to give policymakers the green light for rate cuts.

For monetary institutions poised to cut interest rates this month, the recent drop in oil prices has already opened the door to easing. ECB officials are due to make a second rate cut on Thursday, while the Federal Reserve is widely expected to begin its own easing cycle less than a week later.

The promise of $60 oil price – at least for those investors and policymakers who believe it – has the potential to further depress overall inflation rates and provide consumers with a boost in disposable income. This is a rare bright spot in a world fraught with risks, such as potential trade wars or concerns about what a Chinese deflationary spiral might do to global demand.

“It’s very useful, especially for central banks,” said Christof Ruehl, a senior analyst at Columbia University’s Center for Global Energy Policy. “It takes the pressure off inflation, which is exactly what central banks need right now.”

Adjusted for inflation indicators, oil is now at levels seen two decades ago, when the Beijing commodity boom was just getting started.

Analysts at JPMorgan and Citigroup expect prices to fall further next year as sluggish demand growth is outweighed by a flood of supply.

But the prospect of a descent toward $60 a barrel in 2025, predicted by firms from Citigroup to JPMorgan Chase & Co. could further boost the chances that the U.S. and other major economies can deal with the effects of high borrowing costs without a damaging recession.