MNI BRIEF: Inflation Certainty Needed Before Cuts - De Guindos
Inflation slowing, but conviction needed before Governing Council cuts rates, ECB Vice President said Wednesday.
Inflation will continue to slow across the eurozone in coming months but the ECB's Governing Council will need to be “absolutely convinced” that is converging towards the 2% target before starting to cut interest rates, Vice President Luis de Guindos said Wednesday
“(Interest rates) will go down only when we are convinced that inflation will converge toward price stability levels,” he said in an interview on Spanish TV, adding that recent inflation data have been positive since the December projections. (see MNI INTERVIEW: ECB Inflation Sceptics Hold Upper Hand-Scicluna)
De Guindos pointed to the US elections in November as the geopolitical factor posing greatest uncertainty and backed former ECB president Mario Draghi to boost Europe’s competitiveness, and try an rein back in China and the US.