By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Martin Kocher on Thursday said it would be preferable to bring inflation back to 2% without further interest rate increases, while stressing that policymakers would reassess the situation at every meeting amid high uncertainty and the Middle East-driven price shock.

The Oesterreichische Nationalbank governor told Austrian daily Kurier that necessary rate moves should be taken while unnecessary ones should be avoided.

“As I have said, rate hikes always dampen aggregate demand and are, of course, unpleasant,” Kocher said. “Naturally, it is preferable if we can achieve the 2% target without further rate hikes.”

At the same time, the European economy had recently shown somewhat more momentum, with sentiment indicators improving and industry recovering, he said.

“We’ve fortunately been seeing stronger signals in the European economy for somewhat more momentum since the summer,” Kocher said.

Still, “the economic situation remains fragile,” he said.

On the outlook for monetary policy, Kocher reiterated that the Governing Council would take decisions meeting by meeting rather than commit in advance to another increase.

“We have said clearly — and I believe it is the right approach — that, given the high level of uncertainty and the price shock due to the situation in the Middle East, we will assess the situation anew at every meeting,” he said.