ECB Governing Council member Gediminas Simkus said, “it’s clear that 50 basis points is a must” for December meeting. He added, “because we still see very strong inflation pressures and we need to dampen them as soon as possible to prevent a de-anchoring of inflation expectations.” Yet, “75 is also possible.”
ECB will also discussing shrinking the assets purchased with the stimulus program, also known as quantitative tightening. “The sooner we start quantitative tightening, the better,” he said. “But in smaller steps, so that it can run somewhere in the background.”
