ECB’s Kazāks: Sharp Rate Cuts Unlikely in the Near Future

12 June 2024

By Aurėja Bobelytė – VILNIUS (Econostream) – A rapid reduction of interest rates is unlikely, as the European Central Bank has to have certainty that inflation will remain at low levels, ECB Governing Council member Mārtiņš Kazāks said Wednesday.

In an interview with the Latvian broadcaster LTV, Kazāks, who heads the Bank of Latvia, said, ‘There is no reason to expect a sharp decrease in interest rates in the near future, as we need to ensure that inflation indeed remains at low levels.’

Even though there was hope, inflation could return, he cautioned.

‘At the moment we’re still not there, but the forecasts show that in the second half of next year we’ll be there. Life is, of course, full of surprises, so at the moment we just step by step take the good news that’s there’, he said.