In an interview with Greece’s Imerisia, ECB Governing Council member Yannis Stournaras indicated that while the end of the tightening cycle was in sight, it was not yet complete.
“We’re close to the end,” Stournaras remarked. But, “we’re not there yet, so I agree with Madame Lagarde that we still have some distance to go.”
Stournaras acknowledged the inherent uncertainty in projecting the number of additional rate hikes, with such decisions being heavily influenced by inflation forecasts, economic growth and the state of financial conditions.
“We can’t yet say how many more rate hikes will happen,” he said, tempering expectations for a concrete timeline. “As things stand today and if nothing dramatically changes, we can say that in 2023 rate hikes will end.”
He also emphasized the persistence of current or potentially higher rates, a measure deemed necessary until inflation approaches the 2% target. “Rates will remain where they are today or higher for some time until inflation comes very close to the 2% target,” he clarified.
