Choice Between 25BP and 50BP in May Will Be ‘Close Call’ for ECB, Vujčić Says

14 April 2023

By Xavier D’Arcy – FRANKFURT (Econostream) – The choice between hiking by 25bp or 50bp in May will be a close call for the European Central Bank, Governing Council member Boris Vujčić said on Friday.

In an interview with CNBC, Vujčić, who heads the Croatian National Bank, said ‘it will be data dependent what we decide to do in May, whether we stick with the 50p or we move to the 25bp.’

‘I think it is going to be a close call’ between 25bp and 50bp, he said.

The rapid sequence of three ECB meetings in the next three months gave the ECB more space to adjust its policy: ‘One thing you have to keep in mind is we have then three monetary policy meetings in a short space of time: May, June, July’, he said.

Headwinds for the Eurozone economy could play into the ECB’s hands, he said: ‘Lower growth works the way of also creating conditions in which the inflation pressures would be lower. If that materialises, that would definitely impact also the monetary policy decisions.’

Still, he was bullish on the condidtion of the economy, saying that ‘the conditions for a soft landing have improved’ of late.