The Strategist

ECB rules out interest rate hikes in 2023


09/20/2021 - 07:37



The European Central Bank currently does not expect interest rates, which have been low for a long time, to rise in 2023, said a spokesman for the regulator.



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The last ECB meeting was held in September, following which the watchdog kept the base rate at zero level. In this case, the Governing Council of the ECB at the meeting admitted the possibility of reducing the rate of asset purchases within the framework of a special program PEPP.

The day before, the Financial Times said that according to its unpublished estimates, the ECB expects that the euro zone could reach the inflation target of 2% by 2025. The estimates also do not rule out the possibility that the regulator will raise its rates in about two years' time.

"FT article not true.... The FT's conclusion that an interest rate hike could happen as early as 2023 is inconsistent with our forecast policy directions," an ECB spokesman said.

Such a forecast, called forward guidance by the regulator itself, is public information about the ECB's monetary policy intentions based on its own assessment of price stability prospects, the ECB explains on its website.

The regulator began using this type of forward guidance in July 2013, when its governing council said it expected ECB interest rates to remain low for an extended period of time.


source: ecb.europa.eu