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MNI BRIEF: Data Not Justifying ECB Hike Beyond Expectations

(MNI) Rome

The available data on inflation does not justify "an extension of the hiking cycle" beyond current market peak expectations around 3.25%, Bank of Portugal's Governor Mario Centeno said on Friday while presenting the bank's economic bulletin.

Tighter financial conditions "will not end when the hiking cycle is finished," as ECB interest rates will continue to be above the neutral level for some time with an ongoing effect, he said, adding that could be at peak for two or two-and-a-half years.

The time during which interest rates will remain there will depend on the path inflation takes lower, Centeno said. For him, once inflation starts to fall decisively, the ECB is obliged to again be predictable.

MNI Rome Bureau | +34-672-478-840 |
MNI Rome Bureau | +34-672-478-840 |

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