MADRID, 20 Abr. (EUROPA PRESS) –
The governor of the Bank of the Netherlands, Klaas Knot, considered one of the main representatives of the most restrictive current or ‘hawks’ of the Governing Council of the European Central Bank (ECB), has been in favor of raising interest rates at the meetings in May, June and July if core inflation shows no sign of easing its pressure.
“It is too early to talk about a pause,” says Knot in an interview with the newspaper ‘Irish Times’, in which he defends that to interrupt the sequence of rate hikes it would be necessary to see a convincing change in the dynamics of core inflation .
In this sense, the Dutch central banker admits “not feeling uncomfortable” with the market projections that point to an additional rise of 75 basis points in the price of money, although he stresses that the decision of whether the ECB will raise on May 50 or 25 basis points will likely be determined by inflation data for April, which will be released just two days before the decision.
The data for the month of March, published in second reading this Wednesday by Eurostat, confirmed that the headline inflation rate had fallen to 6.9% from 8.5% in February, while the core rate climbed to a new record 5.7%.
“Now we are in what I would call slightly restrictive territory with policy rates, but inflation is not light. Inflation is still too high,” explains Knot, for whom “it will not be enough” to offset an underlying rate close to 6 % for which it considers it necessary to adopt a “sufficiently restrictive” stance.
“I don’t know where it’s restrictive enough, but clearly not where we are today,” he says.
The Governing Council of the ECB is scheduled to meet on May 4 to evaluate its monetary policy and will do so again on June 15, when it will also publish its new macroeconomic projections, as well as on July 27, 2023.
