The president of the ECB, Christine Lagarde, believes further rises in interest rates are “possible” in addition to the half point expected in two weeks’ time. The number one of the Eurotower said it speaking to a Spanish TV. “At this point, it is possible that we continue on that path,” she underlined when interviewed on the television program Espejo Publico. However, it is “impossible” to say now how much the increase will amount to “in each single meeting”.
The euro area economy is now in a better shape dexpected in December and recent developments were argued to be in line with a “soft landing” (with the economy slowing down but avoiding a recession). Under these circumstances, the Governing Council may be able to bring inflation down without undue sacrifices in terms of economic activity. This is what the members of the Governing Council of the ECB said at the last monetary policy meeting last February, according to the minutes published today.
The Governing Council it should stay the course by significantly raising interest rates at a steady pace and keeping them at sufficiently restrictive levels to ensure a timely return of inflation to the medium-term objective of 2%, the ECB stated in its minutes, reiterating “the intention to raise interest rates by another 50 basis points at the next meeting” of March. The March meeting “is a point of reference for assessing the subsequent monetary policy path, also on the basis of a new set of macroeconomic projections”.
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