ECB’s Escrivá: ‘I Will Not Anticipate’ Our January Interest Rate Decision

16 December 2024

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member José Luis Escrivá said on Monday that he would not predict whether he would support a 50bp cut in January.

In an on-stage conversation at the annual meeting of the Asociación de Mercados Financieros in Madrid, Escrivá, who heads the Banco de España, said that a larger move in January would depend on additional data on inflation and economic activity.

Asked by Econostream if he would be against a 50bp cut in January, Escrivá said that ‘I cannot anticipate the decision because it would go against what we do.’

The neutral rate was an estimate subject to ‘considerable uncertainty, he said.

‘In Europe the range of these estimates can oscillate by one percentage point up and down’, he said.

Forecasting where the neutral rate is was ‘dangerous’, he said, and best not engaged in.

‘We cannot say far in advance what the neutral rate will be’, he said.

Policymakers should constantly revise their view of the neutral rate was, possibly on a monthly basis.