Ecb Council Member Hints Towards 50 Bps Rate Hike In Feb And March

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Ecb Council Member Hints Towards 50 Bps Rate Hike In Feb And March

ECB Council Member Hints Towards 50 bps Rate Hike In Feb And March

Klaas Knot is a member of the European Central Bank (ECB) governing council and thus knows about the inner workings of the institutions. This time, Knot revealed some interesting details in an interview with a media agency. According to Klass Knot, a rate hike of 50 bps is very likely in February and March.

He also made it clear that ECB will continue to raise the interest rate even in the months after March. This comment by Klass Knot confirms the hypothesis that inflation will remain a problem as we enter 2023. After all, the sole reason for raising the interest rates is to control inflation in the EU region.

0.5% Rate Hike In February & March

According to Knot, markets should expect a rate hike of 0.5% in the month of February & the same in March. In fact, he said that the markets shouldn't expect the central bank to be done by the rate hike cycle. He made it clear that more rate hikes will occur during May and June as well.

When Mr. Knot was asked about when the ECB will slow down its speed of rate hikes, he said it was still too early to tell. So even on that front, there's very little chance that we will see a more relaxed approach from the ECB in summer.

But he did talk about how it could happen at some point when the inflation risks become more balanced. But if we look at the inflation situation in the Europe, there are still some major risks for the economy and the people living in the EU.

Knot also said that when the time comes to slow down the frequency of rate hikes, the rate hikes will move from 50 basis points to only 25. But to reach that point, there are still a lot of milestones to achieve!

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