FRANKFURT, April 24 (Reuters) – The following are key comments from European Central Bank policymakers in the run-up to the April 30 meeting.
Markets see rates remaining unchanged this time but expect the ECB to signal that rate hikes will stay on the cards given an energy-driven inflation surge.
Christine Lagarde, ECB President, April 20
“So far, we have not seen energy prices rise far enough to push us squarely into our adverse scenario.”
“This … uncertainty about the duration of the shock and the breadth of pass-through argues for gathering more information before drawing firm conclusions for our monetary policy.”
Isabel Schnabel, ECB board member, April 15
“We have a monetary policy stance that is broadly neutral and this means we can afford to take the time that is needed to analyse the character of this shock. We do not need to rush into action.”
“We have to weigh our policy decisions very carefully and see which (scenario) prevails. We have to stay data-dependent. We have to think very carefully which data can give us information that inflation could become entrenched, and there could be second-round effects.”
Philip Lane, ECB chief economist, April 22
“I think the markets believe we will do what is needed.”
“I know you care if it’s (a rate change) going to be one meeting or another meeting, but in the grand scheme, which meeting it turns out to be that we make the decision … that’s detail.”
Joachim Nagel, Bundesbank President, April 15
“There is not enough clarity (about) what will happen in April, but I still keep the position that we should have all the optionality.”
“Two weeks can bring a lot of new information, and we’ll take it into account.”
Olli Rehn, Bank of Finland Governor, April 16
“What matters most is not the immediate increase in prices, but whether the shock has persistent effects on inflation and the general price level.”
“Right now, the outlook is foggy.”
“Calm judgment will prevail over haste, and no decisions are predetermined.”
Madis Müller, Estonian central bank Governor, April 16
“At this point there is no hard data on (second-round effects) yet.”
“It would also take some time for broader inflationary pressures to take hold.”
“It might therefore be difficult to tell by the end of April if we need to be concerned about it.”
Martins Kazaks, Latvian central bank Governor, April 16
“It’s true we have not seen large second-round impacts materialise up to this point. But this doesn’t mean it won’t happen and when it does, we need to be ready to act.”
“I find (market expectations for two rate hikes) to be reasonable. One move of 25 basis points wouldn’t do much more than signalling.”
Alexander Demarco, Central Bank of Malta Governor, April 16
“My impression is that at this juncture we could be veering towards the adverse scenario.”
“If the adverse scenario would materialise, then two rate hikes anticipated by the market would be a reasonable expectation.”
“So far, inflation expectations are quite well-anchored. We need to be patient, not rush any decision and see what the data tells us.”
Yannis Stournaras, Bank of Greece Governor, April 22
“We are between baseline and adverse scenarios, closer to the baseline scenario.”
Francois Villeroy de Galhau, Banque de France Governor, April 16
“To bet on April would be premature at this stage.”
“We need to reach a sufficient level of data about the effect on underlying inflation and also the negative effect on demand.”
(Reporting by Balazs Koranyi; Editing by Joe Bavier)
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