ECB’s Kažimír: ‘I Will Wait for the New Data in September’

10 June 2024

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Peter Kažimír on Monday said that he was now waiting to see how the data looked in September before acting again and that there was no hurry about monetary policy easing.

In a statement issued on the website of the National Bank of Slovakia, which he heads, Kažimír said that the Council’s decision to cut rates last week ‘sends a clear signal: we expect inflation to continue decreasing from its record highs. This decline is going to be bumpy, but we’re heading toward the target.’

However, he stressed the importance of ‘staying realistic and avoiding excessive optimism, overdo[ne] expectations and hasty decisions’, given that inflation had not yet been vanquished.

‘There’s still a non-negligible risk of resurfacing inflationary pressures linked to global events or rushed rate cuts’, he said. ‘For now, proceeding one step at a time without ruling anything out is the smartest way forward.’

Without mentioning July specifically, Kažimír made clear that he was not in favour of of a rate cut next month, asserting that policymakers could ‘afford to enjoy the summer without hurrying into the decision. We don’t need to rush and there’s no reason to rush.’

The fall would bring significant additional information, he indicated, and September in particular would be a ‘pivotal month’.

‘That will be the right moment to reassess our stance and decide whether we need to adjust our monetary policy settings’, he said. ‘In short, whether to cut rates or not.’

Current data did not support and hurry about policy easing, he said. ‘I will wait for the new data in September.’

‘If further adjustments are needed, we’ll make them; if not, we’ll stay the course’, he added.