MNI BRIEF: Rates ‘Close To Neutral’ – Schnabel In ECB Accounts
MNI (ROME) - European Central Bank Executive Board member Isabel Schnabel defended the notion that “almost the entire euro area real rate curve was currently close to neutral territory,” ECB accounts of the October meeting showed on Thursday.
“The policy stance might be approaching the estimated neutral territory earlier than previously thought,” Schnabel said, according to the accounts of in the monetary policy considerations that were discussed in the meeting . She noted an easing in financial conditions and the decline in expected real interest rates across the maturity spectrum.
During the discussion it was argued that the closer rates were to neutral territory, the more cautious the ECB would have to be so that monetary policy itself did not “become a factor slowing down the pace of disinflation”.