O European central bank (ECB) is likely to raise interest rates fees in smaller portions next year if further adjustments are needed, said the board member Gabriel Makhlouf this Sunday.
The ECB started raising rates at its fastest pace on record in July and markets are betting on a 50 or 75 basis point hike at the next policy meeting on Dec. 15. Makhlouf said this week that his mind is open about the size of that increase.
Although the authorities have been adamant that the fees need to rise further to help reduce inflation, the minutes of the last meeting, published on Thursday, showed that they do not fully agree with the pace and magnitude of this tightening cycle.
“Once we get into next year the likelihood is that if interest rates go up, they will go up in smaller increments,” Makhlouf, governor of the Irish central bank, told the Irish newspaper Sunday Independent in an interview.
“Then we will have to see what is happening with the eurozone economy – so that we can assess how much more we need to do. And at what pace do we need to do this… I think that by the second half of next year we will see it (inflation) lower.”
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Source: Moneytimes
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