ECB’s de Guindos: ‘Huge’ Uncertainty Demands Caution for Future Rate Cuts

12 June 2024

By Aurėja Bobelytė – VILNIUS (Econostream) – European Central Bank Vice President Luis de Guindos on Wednesday called for caution in reducing interest rates in the future, given high uncertainty.

Speaking at a livestreamed MNI Connect event, de Guindos said, ‘The level of uncertainty is huge. That’s why, when you are in a dark room, you have to be very careful. You have to move very slowly, to move with a lot of prudence’.

The main risk was posed by inflation in services, he said, with geopolitical risks also causing uncertainty.

According to de Guindos, the ECB was not pre-committing to any rate path over the next months.

‘The question mark, given the uncertainty, is: "what kind of steps are we going to take over the next months?" But if you ask me: "what's the direction before the end of 2025?" I would say that the direction is clear’, de Guindos said.