November 08, 2024 09:36 GMT
MNI BRIEF: EZ Real Rates Not That High -ECB Wunsch
BNB head points to still high services inflation as a measure for real rates.
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MNI (LONDON) - Eurozone real interest rates are still 'not that high' despite the tightening cycle of recent years, Belgian National Bank head Pierre Wunsch told an MNI Connect event in London.
That probably means that r* remains 'quite low', although it is still difficult to pinpoint it exactly, he said. However, domestic inflation, perhaps best observed through the services inflation, remains high and measured against that, real rates are closer to zero.
Wunsch also pushed back again on the idea of a 50bps rate cut in December, attempting to pour cold water on what he saw as a campaign by some of his Governing Council colleagues for the larger cut. (See MNI SOURCES: ECB Heads For 25BP Cut; Risks From Trump, Germany )
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