European Central Bank Governing Council member Pierre Wunsch, Governor of the National Bank of Belgium spoke at a a news conference on the Belgian national bank's annual report. Comments were embargoed but have now been published.
The European Central Bank will have to gamble soon with an interest rate cut even though wage inflation and price rises for services are uncomfortably high
- "We are going to have to make a bet at some point,"
- felt the Bank should act "before so long", without specifying a month
- He said the ECB was getting to a point where it could react to inflation heading in the right direction. "But it will remain a cautious move on the basis of what I know today because of the problem that has been commented again and again and again that service inflation and wage developments are still running at levels that are ultimately not compatible with our objective,"
- "we are not going to wait until we see wage development at 3% before we cut rates. I guess we'll do it before and that's why I say it's important we need to take a bet,"
ECB's Wunsch
