(Reuters) – European Central Bank (ECB) chief economist Philip Lane sounded cautiously optimistic about slowing inflation, but added that more data was needed before claiming victory on that front.
The Frankfurt institute, which has raised interest rates in its last nine monetary policy meetings, is currently assessing whether a further hike is needed at its next meeting on September 14 or whether it is better to take a break. in the face of a slowing economy.
In an interview with the Irish newspaper The Currency published on Tuesday, Philip Lane considered “welcome” the slowdown in underlying inflation visible in the preliminary data for August published last week.
“But like I said, a month of data is just one piece of information: it has to keep going,” he added.
“The detailed inflation data won’t be released until the middle of the month, so we’ll have to see what happens.”
Markets estimate only 25% chance of a rate hike on September 14 but still expect another 25 basis point hike before year-end, ahead of rate cut expected in mid-2024.
Philip Lane pleaded for patience, pointing to the ECB’s forecast in June that returning inflation to the 2% target will take several years, until 2025.
“Ten percent inflation doesn’t drop very quickly to 2 percent, but…it has already halved from 10 to 5, and further progress is expected this year,” he said. he declares.
(Written by Conor Humphries; Blandine Hénault for the , edited by)
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