ECB Chief Economist Philip Lane, in his speech at a panel held in Dubrovnik, Croatia, said that the ECB’s fight against inflation is approaching a critical turning point, but there is still work to be done.
Lane noted that there is still momentum in commodity and food prices, emphasizing that uncertainty remains “pretty high”. Emphasizing that they think that the downward trend in energy prices will support the decrease in inflation, Lane said, “We expect to cross the critical threshold, but I cannot say that we have reached that threshold yet.” said.
Speaking at the same panel on Friday, ECB Board Member Boris Vujcic stated that the price increase has become sticky. Noting that the upward momentum in inflation is still continuing, Vujcic noted that the authorities are insistent that they will reach the 2 percent target in the inflation rate in the next two years.
Meanwhile, Dutch Central Bank Governor Klaas Knot said on Thursday that borrowing costs should remain there for a “significant” longer after they peak.
While many economists expect the ECB to complete the monetary tightening in June and July, others suggest that it may need to continue after the ECB raises rates two more quarter points.