ECB's Lautenschlaeger sees possible rate hike next year on inflation

ECB executive board member, Sabine Lautenschlaeger, spoke in an interview with Deustchlandfunk radio over the weekend

• Hopes and expects that there will be a rate change in 2019
• It depends on inflation data in Q1 and Q2 2019
• Says ECB may increase rates next year if inflation picks up

The bad news is that inflationary pressures are starting to wind down as per what we saw last week from Germany and Spain respectively. If the trend persists into the new year and growth momentum continues to remain sluggish, expect the ECB to pull the handbrake when it comes to raising rates next year.