Free Trial

MNI BRIEF: Too Soon For ECB To Discuss Cuts - Kazaks

(MNI) London

Monetary policy transmission across the eurozone is strong and bank lending shows further tightening, but it is too soon to consider rate cuts, Bank of Latvia head and ECB Governing Council member Martins Kazaks told an MNI event on Wednesday.

"Inflation is moderating from earlier peaks, reflecting the fading impact of previous upward shocks," Kazaks said, according to the text of prepared remarks. But the ECB still needs to watch out for domestic price pressures, with profit margins still to soften and a clear peak in wage growth yet to be seen, he added.

Interest rates will remain at sufficiently restrictive levels for as long as necessary, with the level and duration determined in a data-dependent manner. But discussions on a rate cuts are premature, he said, adding that the ECB's balance sheet should be reduced in a gradual and orderly manner. (MNI SOURCES: ECB Needs Sub-3% Core Inflation To Consider Cuts)

MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
True
MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
True

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.