Kazaks, member of the Governing Council of the European Central Bank (governor of the central bank of Latvia), spoke with MNI (gated) and Bloomberg (also gated). Via Bloomberg report:
The ECB should not go on “autopilot” to cut interest rates
- dependence on incoming economic data is ‘still essential’
- “Salaries-productivity-profit margins to monitor carefully”
Kazaks says he’s “fine” with current market prices for two cuts this year:
- “As recession risks fade, barring any major surprises, the September 2023 insurance rate hike could now be reversed”
On the divergence with the Federal Reserve:
- “A significant gap between interest rates could lead to a depreciation of the euro, but the disinflationary impact of rate increases > the inflationary impact of the depreciation of the euro”
This article was written by Eamonn Sheridan at www.forexlive.com.
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