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MNI BRIEF: ECB Has 'Ground To Cover' On Rate Hikes - Schnabel

(MNI) London

The European Central Bank remains data-dependent in its policy decision-making, but there is still more to do, Executive Board member Isabel Schnabel told Dutch paper De Tijd in an interview published Wednesday.

"We have more ground to cover. It will depend on the incoming data by how much more rates will have to increase," she said.

Pushed on whether market expectations of two more 25bps rate hikes were realistic, Schnabel again said it was dependent on incoming data. However, she underlined that a peak in underlying inflation would not be sufficient to declare victory, saying "we need to see convincing evidence that inflation returns to our 2% target in a sustained and timely manner. We are not at that point yet."

Looking ahead to future monetary policy, Schnabel said the ECB "wasn't even thinking about thinking about" a change in the inflation target. That could be a different position to the Fed, where MNI has recently reported there could consider a shift away from a point target to a range (MNI POLICY: Fed To Consider Shift To Inflation Target Band)

MNI London Bureau | +44 203-865-3812 |
MNI London Bureau | +44 203-865-3812 |

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