European Central Bank Governing Council member and Irish central bank governor Gabriel Makhlouf said on Thursday that the ECB’s current policy settings are suitable, and any change would require a significant shift in economic conditions.
Key comments from Makhlouf:
- He is comfortable with the current level of interest rates and needs strong evidence to consider altering his view.
- Recent economic outcomes are broadly aligned with existing forecasts, and upcoming projections are unlikely to show major revisions.
- Policymakers should avoid overreacting to minor deviations in the data.
- Inflation risks are now balanced.
- He is fully unconcerned about a potential inflation undershoot next year, saying inflation will still return to target.
Market reaction
The euro remains under pressure, with EUR/USD trading near 1.1520 during Thursday’s European session after extending its earlier losses.
