ECB’s Kazimir Joins Hawks in Urging More Half-Point Hikes

European Central Bank Governing Council member Peter Kazimir joined a chorus of fellow hawks in rejecting suggestions that moderating inflation will soon warrant smaller interest-rate increases, Bloomberg News reported. “We need to deliver two more 50 basis-point moves,” said Kazimir, who also heads Slovakia’s central bank and favors the monetary-tightening cycle being completed by the summer. “The fall in inflation for two months in a row is positive news. But there’s no reason to slow the pace of rate hikes." The retreat in euro-zone price gains back to single digits, alongside a weather-induced plunge in energy costs, is prompting some officials to consider reducing the pace of rate hikes after next month’s planned half-point step, people familiar with their thinking have told Bloomberg. Also speaking Monday, Greece’s dovish central bank chief Yannis Stournaras supported that notion. “The adjustment of interest rates needs to be more gradual, taking into account the slowdown in euro-area economic growth, taking into account the smooth transmission of monetary policy in each country,” he told the Kathimerini newspaper in an interview, according to an emailed transcript. Read more.
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