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Robert Holzmann, governor of Austria’s central bank, speaks during an event in Vienna, Austria, on Tuesday, Sept. 26, 2023.
Bloomberg | Bloomberg | Getty Images
Austrian central bank Governor Robert Holzmann said the European Central Bank could implement one or two further interest rate increases, if there are “additional shocks” to the economy.
The hiking cycle could end, “if everything goes well,” but “if additional shocks come, and if the information we have proves to be incorrect, we may have to hike another time or perhaps two times,” Holzmann told CNBC on Tuesday, speaking from the International Monetary Fund’s World Bank Forum in Marrakech.
The European Central Bank opted to hike interest rates to a record in September, continuing a cycle that has lasted almost two years. The 10th consecutive increase brought the main deposit facility to a 4%, as the bloc continues to battle inflation.
In a market-moving statement in mid-September, the ECB also indicated that further hikes may be off the table for now.
“Based on its current assessment, the Governing Council considers that the key ECB interest rates have reached levels that, maintained for a sufficiently long duration, will make a substantial contribution to the timely return of inflation to the target,” it said, causing the euro to fall to a three-month low.
Earlier on Tuesday, Holzmann’s French counterpart, Francois Villeroy de Galhau said “inflation is the sickness,” while forecasting a landing near 2% by 2025.
He added that there was a “clear downward trend” in prices, in an interview with franceinfo, as translated by CNBC.
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