In an interview with MNI Market News, the head of monetary policy at the European Central Bank (ECB), klaas knotI affirm that headline inflation appears to have peaked, as reported by Reuters. However, Knot added that it may be necessary to maintain the current rate of increases until May if core inflation does not decrease substantially.
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“The sharp decline in energy prices could lower headline inflation faster than the ECB predicted.”
“The slowdown in growth seems even more superficial and ephemeral than expected.”
“Increased activity may improve the bargaining power of workers and lead to more inflation in the future.”
“The ECB’s focus has shifted from energy and headline inflation to the core inflation breakout.”
“I would expect commodity inflation to start falling first.”
“Core services inflation could be more persistent.”
“Core inflation will take time to slow down.”
“Forward-looking wage indicators confirm that wage growth will continue to rise in 2023.”
“Policy rates have moved quickly into the neutral range.”
“Once we see a clear and decisive turn in core inflation dynamics, I hope we will move on to smaller steps.”
market reaction
These comments do not seem to help the euro gain strength against its rivals. At the time of writing, the EUR/USD pair is posting small daily losses at 1.0716.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
