ECB policymaker cautions against rapid rate cuts amid inflation concerns

Investing.com — According to Robert Holzmann, a policymaker at the European Central Bank (ECB), the bank should not lower rates too swiftly due to ongoing issues such as persistent high core inflation.

He made this statement on Tuesday, emphasizing that the forthcoming rate decision will be contingent upon the data accessible at that time.

Holzmann expressed his concern at a conference on central and Eastern Europe, stating that the path to lower rates is not as straightforward as it seems. He cited recent issues with inflation, noting that core inflation is currently closer to 3% than to 2%.

In addition to inflation concerns, Holzmann pointed out the challenges posed by the energy sector. He did not provide further details on these challenges, but his comments underscore the complex factors the ECB must consider in its rate decisions.

The exact nature of these energy-related challenges and how they could impact the ECB’s rate decisions will likely become clearer as more data becomes available.

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