A Governing Council member argues inflation risks justify another hike even if price pressures ease slightly.
European Central Bank Governing Council member Peter Kazimir said at least one more interest rate hike is necessary to counter second-round inflation effects. He warned that waiting until these effects become visible would be costly to reverse and could require even tighter policy later.
Kazimir’s remarks follow recent ECB decisions to raise rates in response to persistent inflation above the 2% target. Markets had priced in a potential pause, but the hawkish stance suggests further tightening remains on the table. The ECB’s next policy meeting is scheduled for October.
The Euro showed limited reaction to Kazimir’s comments, with EUR/USD trading 0.22% higher near 1.1395 amid broader USD strength.