ECB’s Visco: I Have Concerns About Speed and Size of Next Rate Hike
13 April 2023
By Xavier D’Arcy – FRANKFURT (Econostream) – European Central Bank Governing Council member Ignazio Visco called on Thursday for euro area monetary policymakers to be cautious about the speed and size of the ECB’s next rate decisions.
In an interview with CNBC, Visco, who heads the Bank of Italy, said that ‘uncertainty is very high, and we have to be very cautious […] I have issues with the speed and the size of possible movements’. The ECB should ‘decide only meeting by meeting on the basis of the information we gather’, he said.
Risks to the European economy were tilted to the downside, in his view. He said the global economy was ‘not doing very well… with respect to last year it is in a clear slowdown.’
‘Advanced economies are doing a little bit better [than projected a few months ago], but they are slowed down significantly… what is important is not really the expected rate of growth this year, it is the fact that there is a wide uncertainty around these projections and especially that the risks are clearly on the downside for a number of reasons.’
He said ‘the critical issue’ was whether the fall in energy prices would be reflected in core inflation. If prices did not respond, ‘then work has to be done’, he said.
‘If the data tells us that there is still difficulty in bringing the core inflation down, we have to be very calm and patient’, he said.