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ECB policymakers may put hike of 75 bps on table at October meeting

The ECB lifted interest rates by a combined 125 bps at its past two meetings, the fastest pace of policy tightening on record, but inflation may still be months from its peak

Topics
European Central Bank | Interest rate hike

Reuters  |  Frankfurt/Helsinski 



ECB, European Central Bank
FILE PHOTO: Specialists work on a crane in front of the European Central Bank (ECB) in Frankfurt

The may need to raise interest rates by another 75 basis points (bps) at its October meeting and move again in December to a level that no longer stimulates the economy, policymakers said on Wednesday.

The ECB lifted interest rates by a combined 125 bps at its past two meetings, the fastest pace of policy tightening on record, but may still be months from its peak, pointing to even more tightening from a bank that started hiking well after most of its top peers.

“I have to say that 75 bps is a very good candidate for (our next move to) maintain the pace of tightening, but it is also necessary to wait for fresh data,” Slovak central bank governor Peter Kazimir told a news conference. “We have to be vigorous, even ruthless, regardless of the looming recession,” Kazimir added.

Finnish central bank chief Olli Rehn, considered a moderate swing voter, also said that 75 basis points could be among the options.

“There is a case for taking a decision on another significant rate hike, be it 75 or 50 bps or something else,” Rehn told Reuters

without elaborating on what ‘something else’ may entail. “There is a stronger case for frontloading.”

Outspoken policy hawk Robert Holzmann, Austria’s central bank governor, also backed a 75-bpsmove in an interview with Bloomberg TV.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)


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First Published: Thu, September 29 2022. 00:14 IST

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