(Reuters) – The European Central Bank should keep all its options open for its next decisions, three policymakers said on Friday, as the central bank cut its deposit rate to 3.50 percent on Thursday.
The ECB must “continue to gradually reduce the restrictiveness of its monetary policy to a relevant degree,” declared the governor of the Bank of France, François Villeroy de Galhau, who considers that the decision taken Thursday was “obvious.”
“This pace must be pragmatic: we are not committing to a particular rate path and are keeping our options open for the next meeting,” added the member of the governing council, who was speaking at the Eurofi forum in Budapest.
Bank of Finland Governor Olli Rehn said in a statement that “monetary policy decisions will continue to be taken on the basis of inflation expectations, underlying inflation (…) and the transmission of monetary policy.”
Bundesbank Governor Joachim Nagel expressed confidence that the disinflation process would continue.
“We expect to reach our inflation target by the end of next year. Core inflation is also heading in the right direction,” the Governing Council member told German radio station Deutschlandfunk.
The ECB on Thursday lowered its deposit rate by 25 basis points to 3.50%, citing the slowdown in inflation and growth in the eurozone.
(Written by Balazs Koranyi, Anna Ringstrom, Francesco Canepa, Corentin Chappron, edited by)
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