More ECB Rate Hikes Necessary, but Peak Is Approaching, Vasle Says

25 May 2023

By Xavier D’Arcy – FRANKFURT (Econostream) – The European Central Bank is approaching the terminal rate necessary to bring inflation back to target, though further rate hikes will be necessary, ECB Governing Council member Boštjan Vasle said on Thursday.

In an interview with Slovenian national daily Delo, Vasle, who heads the Bank of Slovenia, said that ‘further interest-rate increases will be needed […] but they'll be smaller than they were in the past. We're approaching the level of rates that's restrictive enough to bring inflation back toward 2%.’

He called for a better policy mix to combat high inflation: ‘Fiscal — including wage policy — and monetary policies will have to be linked to a greater extent than in the past.’