The European Central Bank (ECB) released account of its January 24-25 monetary policy meeting, at which its policymakers decided
to leave its three key interest rates unchanged. It noted that:
- Governing Council’s members
noted that measures of underlying inflation had passed their peak;
- Members
signalled that continuity, caution and patience were still needed since the
disinflationary process remained fragile and letting up too early could undo
some of the progress made;
- Members
expressed increased confidence that inflation would be brought back towards the
2% inflation target in a timely manner;
- It was affirmed that further progress needed to be made in the
disinflationary process before members could be sufficiently confident that
inflation was set to hit ECB’s target in a timely manner and in a sustainable
way;
- Future decisions would ensure that policy rates would be set at
sufficiently restrictive levels for as long as necessary;
- There was broad consensus among members that it was premature to
discuss rate cuts at the present meeting;
- The risk of cutting policy rates too early was still seen as
outweighing that of cutting rates too late;
- Members agreed that following a data-dependent rather than a
calendar-based approach was important