FRANKFURT (Reuters) -A clear majority of European Central Bank policymakers meeting on Thursday expressed a preference for holding interest rates steady next month and a few even made the case for an even longer pause, four sources told Reuters. The ECB cut interest rates for the eighth time in a year on Thursday but hinted […]
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ECB governors see July pause but Sept up in the air
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FRANKFURT (Reuters) -A clear majority of European Central Bank policymakers meeting on Thursday expressed a preference for holding interest rates steady next month and a few even made the case for an even longer pause, four sources told Reuters.
The ECB cut interest rates for the eighth time in a year on Thursday but hinted at a pause in its year-long easing cycle after inflation finally returned to its 2% target.
ECB policymakers did not explicitly discuss their July decision but their deliberations revealed a clear preference for no change then since little new information would come out in the next six weeks and interest rates were already low enough to support the economy, the sources said.
An ECB spokesperson declined to comment.
While some policymakers argued for a longer pause, most preferred not to discuss meetings beyond July, arguing that new economic projections in September would be crucial.
Some also argued that any meaningful fall in inflation below 2% in the coming months could justify a further cut in borrowing costs.
All policymakers apart from Austrian governor Robert Holzmann backed Thursday’s rate cut.
(Reporting By Balazs Koranyi and Francesco Canepa; Editing by Hugh Lawson)