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ECB’s Lane: Remarkably stable baseline leaves no near-term rate debate
ECB Chief Economist Philip Lane said the Eurozone is now in a “remarkably stable situation,” arguing there is "no near term interest rate debate" under the central bank’s baseline scenario. Speaking in an interview with La Stampa, Lane said the current policy setting is consistent with inflation staying around target, growth close to potential, and low, declining unemployment.
Lane stressed that the current level of interest rates provides the baseline for “the next several years.” With the economy expected to grow in the neighborhood of its potential rate, he said it would take a significant acceleration in activity to push outcomes meaningfully above the baseline and trigger a policy response.
One alternative scenario he flagged was a major global disruption similar to 2021–2022, involving supply-chain bottlenecks. Lane described this as a “nightmarish” outcome, noting it would also carry recessionary forces rather than a clean inflationary impulse.
NZ BNZ PMI surges to 56.1, a four-year high
New Zealand’s manufacturing sector ended 2025 on a strong footing, with the BusinessNZ Performance of Manufacturing Index jumping sharply from 51.7 to 56.1 in December. The reading marked the highest level of activity since December 2021 and moved decisively above the long-run average of 52.5.
The rebound was broad-based. Production rose from 53.2 to 57.4, while new orders surged from 52.5 to 59.8, pointing to strong demand momentum. Employment also improved, climbing from 52.6 to 53.8, suggesting firms are beginning to respond to higher workloads. Positive commentary from respondents increased to 57.1%, up from 54.4% in November and just 45.9% in October.
BNZ Senior Economist Doug Steel said the PMI is positive for Q4 GDP calculations and points to good momentum heading into the new year, flagging "upside risks" to already constructive near-term growth forecasts.
Goolsbee warns Fed independence under threat risks inflation surge
Chicago Fed President Austan Goolsbee delivered a blunt warning on central bank independence, saying any attempt to undermine the Fed would have severe economic consequences. “Anything that’s infringing or attacking the independence of the central bank is a mess,” he told CNBC.
Goolsbee cautioned that political interference in monetary policy would almost certainly reignite inflation pressures. “You’re going to get inflation come roaring back if you try to take away the independence of the central bank,” he said.
Drawing an international comparison, Goolsbee noted that criminal investigations targeting central banks are typically seen in countries such as Zimbabwe, Russia, and Turkey. He said these examples are not ones “you would characterize as advanced economies”.