ECB Governing Council Mueller: Wage increases won't stop interest rate cuts in June

Gelonghui Finance ·  May 24 21:55
GRONGHUI, May 24 | ECB Governing Council Member Mueller said that a jump in one of the key indicators for measuring wages in the Eurozone will not affect the continued decline in inflation, nor will it prevent the ECB from cutting interest rates in June. Mueller stressed that the wage negotiations data for the first quarter of this week included some lump-sum payments, which yielded “slightly higher” figures. “I'm not really worried because I don't think the downward trend in inflation will be broken,” he said. “But it emphasizes the need to monitor developments, and I think it also shows that we cannot expect inflation and other key variables to decline linearly, such as wage growth and potential inflation indicators.” He also said, “I want the market to guess the interest rate level at the end of the year.” “If developments continue to be more or less in line with expectations and inflation continues to be close to target, then we need to acknowledge that there is room for further easing by the end of this year.” However, he also emphasized the possibility of “an unexpected rise in inflation,” and said that decisions should not be made in a hurry.

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