Philip Lane, chief economist at the European Central Bank (ECB), said on Monday. to climb interest rates “at a constant speed”i.e. “neither too slow nor too fast”, because it allows “to do”. middle ground fixes“If necessary.
This was articulated by Lane, who was head of the Irish central bank from 2015-2019, at a roundtable meeting held as part of the annual meeting organized by the Central Bank Research Association (CEBRA, acronym for English). this occasion takes place at the University of Pompeu Fabra (UPF) in Barcelona.
ECB, a high context inflation As a result of the war in Ukraine and the post-pandemic, it has now approved a half-point rate hike, up to 0.50 percent for the first time in eleven years. Lane, who was chairman of the Bank of Ireland from 2015-2019, did not comment on possible rate hikes in the near future, but favored the changes being made gradually.
He pointed out that “the upside risks to inflation are currently more intense than the downside risks,” but warned that the situation could change given the low growth of inflation. associated with an increase in cost. energy prices. It therefore considers that corrections should not be made abruptly, but at a “fixed rate” to be corrected as needed.
Lane also said that the next meeting of the ECB Governing Council “The beginning of a new phaseGiven the economic conditions of “high uncertainty”, the data should be “gathered and analyzed”. The risks are for the inflation target,” he said.
And the purpose of the ECB is, raise inflation to 2% in the medium term, he reminded.
The ECB chief economist made these remarks as part of CEBRA’s annual meeting, which takes place Monday through Wednesday, bringing together more than 200 researchers from different central banks from around the world. Specifically, he shared a roundtable with Martin Flodén, vice-president of the Swedish central bank, and Diogo Abry Guillen, vice-president for economic policy at the Brazilian central bank. On Wednesday, Margarita Delgado, vice-president of the Bank of Spain, is scheduled to intervene in the same forum.
In these three days, experts are discussing about r in more than 30 parallel sessions.current economic values In the context of high inflation and rising interest rates.
The central bankers meeting began just three days later, despite a warning from Federal Reserve chief Jerome Powell on Friday. the consequences of continued increases in interest rates The “pain” will be greater in companies and families if a restrictive monetary policy is not maintained to reduce inflation.
Powell, at the opening of the meeting of economic leaders in Jackson Hole, Wyoming (USA), reminded that the US central bank increased interest rates by 0.75 percentage points in July (the fourth and second rate hike in a row). The same amount in a row) warned of another possible “extraordinarily large increase” in September, but this Friday has conditioned the possible uptick in data and the economic outlook.