ECB’s Makhlouf: “Need to See Pretty Compelling Evidence to Move”

20 November 2025

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Gabriel Makhlouf said on Thursday that only a significant change in the outlook would lead him to consider another interest rate move.

In an interview with Reuters that largely echoed a press conference earlier in the week, Malhlouf, who heads the Central Bank of Ireland, said that his “expectations are that there won't be significant change [in the December projections] based on what's happened in the real economy.”

He added that the latest data appeared to confirm the outlook, and said he felt “comfortable” with the current level of interest rates given the “good place” the ECB was in.

“I’ll need to see pretty compelling evidence to move,” he said.

He played down the concern about a potential undershoot of inflation and said he was not worried about the projected low inflation for 2026, as he expected it would come back up in 2027.

The ECB should remain cautious about responding to minor deviations from target because inflation expectations were anchored, he said, and added that the ECB should mainly worry about significant and sustained declines below 2%.

“If the projections are at 1.8%, I'd be less worried about it,” he said.

The institution had to stick to its meeting-by-meeting approach given the potential for the current situation to rapidly change, he said, noting that policymakers should be open to any move.

He added that the global trade order had been disrupted, the EU was still facing a war on its eastern border, US equity seemed overvalued, credit standards were weakening, opaque private-credit markets were expanding rapidly, and the political environment remained uncertain.