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MNI BRIEF: Significant Hikes Needed After March - Buba's Nagel

(MNI) London

The ECB should follow March’s expected 50bps hike with more “significant” rate rises, Bundesbank president Joachim Nagel said in an interview with Boersen-Zeitung Tuesday, and expressed his opposition to any rate cuts in the foreseeable future, saying "we're still a long way from achieving price stability, our job isn't done yet".

"I would strongly advise interpreting the latest statement for what it is: a robust announcement that points beyond the March meeting," Nagel said. He believes that there will be discussions about falling interest rates in the future absolutely premature: “For the foreseeable future, interest rate cuts are not on my agenda at all.”

Germany’s economy could stagnate this year, Nagel said, citing the Bundesbank’s December projection of a 0.5% fall in GDP, while inflation is now more likely to average around 7% than 6%.

MNI London Bureau | +44 20 3983 7894 |
MNI London Bureau | +44 20 3983 7894 |

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