One more rate hike of 25 basis points by the European Central Bank should be enough [για τον έλεγχο των πληθωριστικών πιέσεων] said the governor of the Bank of Greece and member of the ECB Governing Council, Yannis Stournaras, in an interview with CGTN Europe on Wednesday. He also added that further tightening of monetary policy after that could hurt the economy.
The ECB raised interest rates to the highest level in 22 years at its June 14-15 meeting, underscoring that a ninth straight hike is all but guaranteed in July as it forecast inflation would remain above its 2% target until the end of 2025.
“We may have another move next week of 25 basis points, but I’m not sure we’ll go any further,” Stournaras said. “We’ll stop there. That’s my view,” he told the broadcaster, which is owned by China’s World Television Network.
Stournaras is considered among the “doves” on the ECB’s 26-member governing board.
Inflation is coming down
Asked what would make the case for ending interest rate hikes rather than going any further, Stournaras pointed out: “The argument that inflation is falling and we’ve found that we’re at the sweet spot that further interest rate hikes can hurt the economy.”
Analysts expect the ECB to raise its benchmark interest rate by 25 basis points to 3.75% at its next meeting on July 27.
ECB Governing Council member Claes Knott said on Tuesday that a rate hike beyond July “would be at most a possibility, but by no means a certainty.”
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