ECB’s Knot: ‘The Next Meeting That Will Truly Be Open Again Will Be in September’

8 July 2024

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank Governing Council member Klaas Knot on Monday said that the occasion for the Governing Council to discuss another interest rate cut in depth would be in September, not in July.

In an interview with German business daily Handelsblatt on the margins of the ECB Forum on Central Banking, Knot, who heads De Nederlandsche Bank, said, ‘I see no reason for an interest rate cut in July’, and, ‘The next meeting that will truly be open again will be in September.’

The current market expectations of future interest rate cuts and the ECB’s monetary policy stance were ‘perfectly fine’, he said.

Minor upside variations in inflation in the following months should not interfere with the ECB’s medium-term orientation, he said, but new shocks would demand patience.

‘If we were to face renewed setbacks on that trajectory, we would have to be even more patient relative to what markets are currently pricing,’ he said.

The disinflation process was ‘well entrenched and underway’, but it was still necessary to ‘remain vigilant because upside inflation risks remain’, he said.