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  • 18 OCTOBER 2024
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BCE. Philip Lane wants a restrictive policy and a rate cut in June

The European Central Bank’s (ECB) chief economist, Philip Lane, has argued that the institution should maintain a restrictive interest rate policy this year, despite being in favor of a cut in June.

BCE. Philip Lane wants a restrictive policy and a rate cut in June
Notícias ao Minuto

11:22 - 27/05/24 por Lusa

Economia BCE

In an interview with the Financial Times published today, Lane said that barring major surprises, the ECB will cut interest rates in June, although from then on it will be “difficult and gradual”, so its policy should remain restrictive throughout the year.

"The magnitude of inflation that we still see in services and in underlying inflation clearly means that we have to be restrictive this year, because we have to make sure that the still-significant cost pressures do not feed too much into price increases,” he said.

Regarding the rise in wages in the eurozone, which rose 4.69% year-on-year between January and March, Lane said that they had already anticipated this trend and that the data continues to point to a slowdown, although wages will only normalise in 2026.

"More generally, we were saying that inflation is going to go up this year and that wages are also going to go up to some extent. But there is a downward trend, although there are basically fluctuations around that trend,” he said.

Read Also: Euro rises after statements by ECB official (Portuguese version)

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