ECB’s Kažimír: ‘Our Policy Stance Is No Longer Restrictive’

22 April 2025

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Peter Kažimír on Tuesday said that ECB monetary policy had ceased to hold back euro area economic growth.

In a statement issued on the website of the National Bank of Slovakia, which he heads, Kažimír said, ‘The recent series of interest rate cuts has placed us in a neutral range. Our policy stance is no longer restrictive and does not hinder economic activity.’

The ECB had made ‘significant progress’ in restoring price stability, which he said he was ‘confident’ would be reached ‘within the next few months.’

Policymakers must nonetheless proceed with care, remaining ‘vigilant and agile’, he said. Uncertainty was dominant, he said, with US trade measures having eroded confidence.

‘We need time to see how all this unfolds, to analyse incoming data and information, and to learn about the risks associated with it’, he said. ‘This ambiguity affects the outlook for both inflation and economic growth.’

The next few weeks should bring some clarity, but not complete certainty in time for the Governing Council’s June meeting, he said.

Monetary authorities will thus remain data-dependent, with no pre-commitment, he said. Economic indicators and answers to open questions related to trade will be ‘critical’, he said.

‘June’s decision will depend heavily on new data, updated forecasts and risk assessment’, he said. ‘This reinforces our commitment to flexibility and agility.’

Circumstances called for ‘a balance of caution and pragmatic optimism’, he said.

Kažimír called last week’s 25bp rate cut by the ECB ‘prudent’ and ‘clearly justified’ by ongoing disinflation.