ECB Governing Council member Robert Holzmann told FT in an interview, that he could “see no signs that core inflation is reducing” . He added that another big rate hike “would give a strong signal about our determination,” as “it would tell businesses and trade unions we are serious so don’t underestimate us, be careful.”
He backs another 75bps rate hike in December but he was still “open to changing my mind” based on the ECB’s new quarterly economic forecasts. He added that interest rates could need to rise to a level where they “caused pain”. Hence, it’s important to hike “early” because “afterwards the pain is much, much larger.”
