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(Bloomberg) — European Central Bank Governing Council member Klaas Knot said there’ll still be more than one half-point increase in interest rates, with the inflation situation remaining unsatisfactory.Most Read from BloombergInvestors, who’ve been softening bets on monetary tightening, may be underestimating the ECB’s commitment to tame prices, Knot told CNBC on Thursday. Policymakers are focused currently on the risk of doing too little, he said.“Our president has already announced that most of the ground that we have to cover we will cover at a constant pace of multiple 50 basis-point hikes,” the hawkish Dutch central bank chief said in Davos.ECB President Christine Lagarde on Dec. 15:“So we will continue that at a steady pace. Based on the information that we have available today, that predicates another 50-basis-point rate hike at our next meeting, and possibly at the one after that, and possibly thereafter, but everything will also be determined by the review of data. So don’t assume that it’s a one-shot 50; it’s more than that.”For full press conference transcript, click here“It will not stop after a single 50 basis-point hike — that’s for sure,” Knot said. “Core inflation has not yet turned the corner in the euro area.”Money markets raised wagers on the peak deposit rate by 4 basis points to 3.36%. That compares with as low as 3.28% on Tuesday.Knot’s remarks feed into a debate about whether the time is approaching to further slow the most aggressive bout of tightening since the ECB was created. Weaker inflation, plummeting energy prices and a most robust economy are behind arguments to do so. But many officials are zeroing in on underlying price gains, which hit a record last month.Story continuesSeveral policymakers are considering whether a smaller rate increase may be appropriate following February’s expected half-point increase, according to officials with knowledge of their thinking.Guidance from Lagarde that borrowing costs will continue to be lifted in 50 basis-point steps for some time remains valid today, Bank of France head Francois Villeroy de Galhau told Bloomberg TV this week in Davos, Switzerland.There are “no signs of abating of underlying inflationary pressures,” Knot said.–With assistance from James Hirai.(Updates with market rate bets in fifth paragraph.)Most Read from Bloomberg Businessweek©2023 Bloomberg L.P.

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