ECB to end rate hike soon
2022.12.06 05:46
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ECB to end rate hike soon
Budrigannews.com – According to ECB policymaker Constantinos Herodotou, interest rates will rise once more, but they are now “very close” to their neutral level.
“The neutral rate is very near us. “I think there will be another hike or hikes,” Cyprus’ ECB Governing Council member Herodotou stated at a Bloomberg event.
The European Central Bank (ECB) is anticipated to raise rates by another 50 basis points on December 15, slowing the pace of policy tightening after back-to-back moves of 75 points. Since July, the ECB has raised rates by a combined 200 basis points.
Herodotou made it clear in his remarks that he was referring to rate hikes in the plural. He also said that he didn’t think the euro zone, which will have 20 countries by the end of next year, would have a “hard landing” despite its current slowdown.
“There are various factors that might give some solace and should there be a financial effect, it will not be.. a hard landing” he expressed, highlighting government support and a tough European positions market.
At its meeting, the ECB will also release new staff forecasts that are expected to show that inflation will not return to the bank’s preferred level of close to 2% next year and that there will be a mild recession.
Herodotou stated, “There will be more rate hikes to contain inflation.”
