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ECB May Only Cut Rates Once More This Year, Kazimir Says

(Bloomberg) -- European Central Bank Governing Council member Peter Kazimir said one more reduction in borrowing costs is likely in 2024.

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“I think we could expect one more interest-rate cut this year,” the Slovak official said Thursday. “I still see a significant risk of rising inflation, which may not fully align with our expectations. I expect this pressure of possible price increases mainly from wage growth.”

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While most ECB officials have been cautious on next steps following this month’s initial decrease in the deposit rate, some are now starting to reveal where they see monetary policy headed. Speaking this week to Bloomberg, Finland’s Olli Rehn described investor bets on one or two more quarter-point moves this year as “reasonable.”

Reiterating opposition to another shift in rates at the ECB’s July meeting, Kazimir said policymakers should at least wait for the next round of quarterly economic projections.

“It’s appropriate to wait for the September forecast,” he told reporters in Bratislava. “Those are the right moments to make the correct decisions.”

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