(Bloomberg) — European Central Bank Governing Council member Joachim Nagel said he doesn’t think interest rates have reached a level that puts a brake on economic activity — something that officials deem necessary to get inflation under control.
(Bloomberg) — European Central Bank Governing Council member Joachim Nagel said he doesn’t think interest rates have reached a level that puts a brake on economic activity — something that officials deem necessary to get inflation under control.
“From today’s point of view, I can’t see that we’re in restrictive territory now, and I can’t say exactly where the restrictive territory will be,” Nagel said at an event in Berlin. “I’ll make that dependent on what the new projections will look like.”
ECB officials have said that borrowing costs will need to reach a “sufficiently restrictive” level and that they intend to raise them by another 50 basis points when they meet in March.
Nagel said that even after that, more needs to be done.
At current levels, inflation can prove “very persistent,” he said. “It’s always been a cardinal mistake on the part of monetary policy to let up too soon in such a phase.”
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