ECB’s Centeno: Even in a Good Position, We Must Not Overlook Risks

26 September 2025

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Mário Centeno said on Friday that being in a “good position” should not be mistaken for an absence of risks to inflation.

In an interview with CNBC, Centeno, who heads the Banco de Portugal, said that he did not expect geopolitical tensions to ease anytime soon, which for him meant that “even if we are currently in a good position, that doesn’t mean that we can downplay risks.”

He noted that risks to both inflation and growth were tilted to the downside, which he considered helpful, since having them aligned suggested the ECB would know “what to do in terms of monetary policy.”

“If there is upward pressure on the euro we do know what will be the impact on inflation and growth and of course the ECB, if that is the case, must act,” he said.

Inflation below 2% could be acceptable only if it did not last more than a few months, he said, adding that it would be “risky” to let inflation undershoot for longer.

He said that without the ETS 2 impact expected for 2027, inflation would be “really below 2% for a period of time,” he said. “We need to take that into account.”