European Central Bank (ECB) Chief Economist Philip Lane said on Wednesday that “further increases” in eurozone interest rates are needed to “stop the rise” in the rate of inflation.
At the eurozone money market contact group meeting, Lane defended the “aggressive” increase in interest rates last week due to high inflation.
On Thursday, the ECB raised interest rates by 75 basis points to 1.25% and said it would raise them at future meetings.
Lane explained that the Governing Council of the ECB considers that “it is necessary to continue raising interest rates in the next meetings” to reduce demand.
The next decisions on the magnitude of interest rates will depend on the macroeconomic data that is published and will be taken at each meeting.
“We expect interest rates to rise because inflation is very high and will probably remain above the ECB’s target (2%) for a long time,” the economist said.
Source: TSF
