ECB’s Nagel: Should ‘Remain Cautious and Not Rush into Anything’ in December

30 October 2024

ECB’s Nagel: Should ‘Remain Cautious and Not Rush into Anything’ in December
Joachim Nagel, president of the German Bundesbank, at the ECB Governing Council meeting in Ljubljana on October 17, 2024. Photo by Adrian Petty/ECB.

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Joachim Nagel said on Wednesday that the ECB should take further steps carefully and avoid acting too quickly.

In a speech at the Frankfurt Society for Trade, Industry and Science, Nagel, who heads the German Bundesbank, said, ‘In December, the ECB Governing Council has a new forecast. It will show us whether we are still on track with inflation. My advice is to remain cautious and not to rush into anything.’

As the ECB awaits the first inflation estimate for October, due tomorrow, Nagel reminded that inflation was expected to register an uptick again, essentially due to energy-related base effects.

The target was close despite monthly volatility, but the journey was not over, according to Nagel.

‘If you look through the monthly ups and downs, you can see that price stability is not far away, but we still have to go the last part of the road’, he said. 'Services inflation in particular, which experience has shown to be quite sluggish, remains high at 3.9%.’

As for the October cut, Nagel said he considered the move ‘appropriate, as the data painted a slightly more favourable inflation picture’.

Data-dependency had been demonstrated to be useful, especially given the current uncertainty, he said.