ECB’s Escrivá: Rate Level Appropriate if Baseline Materializes, Should Remain Agile

6 October 2025

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member José Luis Escrivá said on Monday that the ECB’s interest rate level remained appropriate as long as the baseline scenario continued to hold, while stressing the need for agility if conditions change.

In a panel discussion at a financial conference organized by Spanish daily Expansión in Madrid, Escrivá, who heads the Banco de España, said that inflation had hovered around 2% in recent months and was expected to remain near that level in the coming years.

“If the baseline scenario keeps materializing, the level of interest rates seems appropriate,” he said, adding that rates would not remain at current levels indefinitely and future moves would depend on how risks unfold.

He described the situation as a paradox, given that despite high uncertainty, the baseline scenario has materialized quarter after quarter.

“Downside risks to growth that we identified back then have not materialized,” he said. “That doesn’t mean they cannot, but they haven’t yet.”

Despite acknowledging that the environment is now more “comfortable,” Escrivá urged continued vigilance over potential triggers for policy action.

“We have to remain agile and ready to react, which is consistent with saying that interest rates are at an appropriate level,” he said.