Latvian central banker says wage growth hasn’t peaked
Betting that the European Central Bank cuts interest rates in the first half of next year would be a mistake, according to bank governing council member Martins Kazaks.Betting that the European Central Bank cuts interest rates in the first half of next year would be a mistake, according to bank governing council member Martins Kazaks.
Traders are starting to price cuts from April of next year and some economists see them as early as June.Projections presented last week show that inflation in the 20-member euro area will take another two years to reach 2 per cent, even as price pressures are set to slow sharply in the coming months. The economy is seen returning to quarterly growth rates of 0.4 per cent in 2024 after stagnating for most of 2023.
Since then, many of the ECB’s 26 officials have shared their views on where policy should be heading next. Estonia’s Madis Muller said in a separate interview there’s a “good chance” policymakers have done enough. Austria’s Robert Holzmann and Slovenia’s Bostjan Vasle argued another hike can’t be excluded, while Greece’s Yannis Stournaras said he already would have preferred to keep rates unchanged last week.
“I repeat, we have not decided, discussed or even pronounced cuts,” she said in Santiago de Compostela.
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