The central bank will make smaller increases in the key interest rate in 2023 if further hikes are needed, Governing Council member Gabriel Makhlouf said on Sunday, as quoted by Reuters.

In July, the ECB began raising interest rates at the fastest pace on record, and markets are betting on a 0.5-0.75 percentage point hike at its next monetary policy meeting on December 15.

Makhlouf said last week that he was not considering the size of that increase.

While policymakers were adamant that interest rates should rise to help slow inflation, minutes of their latest meeting released on Thursday showed they could not fully agree on a final destination or pace of increases.

“When we start next year, the probability that if interest rates go up, they will go up to a lesser extent,” Makhlouf, the governor of the central bank of Ireland, told the Irish newspaper Sunday Independent.

He explained that “we will have to see what happens with the eurozone economy so that we can judge what we still need to do. And at what pace we need to do it… I think by the second half of next year we will see lower (inflation )”.

Source: news.ro