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BRIEF: ECB's Wunsch-Better To Err On Side Of Cutting Too Late

(MNI) Brussels

It would be better for the European Central Bank to err on the side of cutting interest rates a bit too late than too soon, Belgian National Bank Governor Pierre Wunsch said in a speech on Wednesday.
While the eurozone appears “set for a soft landing in the short term” as inflation continues its gradual fall, risks remained “unusually large” both to the downside and upside linked to potential volatility in energy prices, Wunsch said, warning that it would be unwise to “declare victory over inflation” too soon. (See MNI INTERVIEW: ECB Should Hold Until At Least Spring-Vujcic)
“It is better to err on the side of cutting interest rates a bit too late than too soon,” Wunsch said.
Still, the chances of another hike were now lower, he said, “unless we have a shock on the energy price front.”

MNI Brussels Bureau |
MNI Brussels Bureau |

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