Joachim Nagel, one of the hawkish names of the European Central Bank, said that a rate hike is needed at the meeting in July, and that more data should be seen for the September meeting.
European Central Bank Board Member and Bundesbank President Joachim Nagel said the European Central Bank should raise interest rates again this month and will base its decision on data at the next meeting.
Nagel, known as one of Europe’s hawk names, said: “Next time we have to increase and I expect another 25 basis points increase for the July meeting. We will see what the data will tell us for the September meeting.”
Where he was for the G-20 meetings, Nagel described the basis of inflation as “very sticky”.
“Core inflation for more or less all developed countries is perhaps not falling as it has in past cycles,” said Nagel, again speaking of inflation as a ‘greedy beast’.
While markets and economists predict that interest rates will be increased both next week and in September, and deposit rates will be increased from 3.5 percent to 4 percent, officials do not seem to agree on the path after the summer.
While some members, including Nagel, say that a new move should not be ruled out, some members are worried about the future of the 20-country Eurozone economy, which fell into a mild recession in the winter.