ECB's Knot: We need at least two more rate hikes
In an interview with Italy's Corriere della Sera, European Central Bank (ECB) policymaker Klaas Knot said that the ECB needs to raise the policy rate at least two more times, as reported by Reuters.
Knot further argued that rates should stay put for a significant period of time following these increases.
Additional takeaways
"Headline inflation peak behind us but not sure if at peak of underlying inflation."
Most of impact of ECB's monetary tightening is still in the pipeline."
"Next two ECB hikes should be 25 bps each."
"I am totally open-minded on what happens with rates after the summer."
"Market pricing of rate cuts is overly optimistic."
Market reaction
These comments failed to help the Euro gather strength against its rivals. As of writing, EUR/USD was down 0.35% on a daily basis at 1.0712.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
