ECB Policymaker Pereira Urges Action on Inflation Sooner Rather Than Later
European Central Bank policymaker Pereira said the bank must act on inflation sooner rather than later, adding to signs of a firmer stance among some officials.
The comment follows remarks from Governing Council member Gediminas Simkus that he is likely to support a June rate hike and sees a second move as more likely than not, though the timing of any follow-up increase is unclear. Accounts of the ECB's latest meeting showed the last rate decision was close, with officials saying upside risks to inflation and downside risks to growth had intensified as the energy-price shock became more persistent, even as they saw little evidence so far of strong second-round effects.
From the sources (25 posts)
@firstsquawkFINANCIAL MARKETS UNDERESTIMATE GEOPOLITICAL AND FISCAL RISKS, ECB WARNS-WSJ
@firstsquawkECB LAGARDE SAYS CENTRAL-BANK CREDIBILITY IS KEY IN NEW WORLD ORDER
@deitaoneECB ACCOUNTS: UPSIDE RISKS TO INFLATION AND DOWNSIDE RISKS TO GROWTH HAD INTENSIFIED. ECB ACCOUNTS: WEAKNESS COULD PERSIST WELL BEYOND THE END OF THE CONFLICT
@firstsquawkECB REPORT SUGGESTS WEAKNESS MAY LAST LONG AFTER THE CONFLICT ENDS.
@firstsquawkECB REPORT SHOWS MINIMAL PROOF THAT RISING ENERGY COSTS ARE CREATING FOLLOW-ON EFFECTS.
@firstsquawkECB REPORT SHOWS IT'S STILL TOO EARLY TO SEE SECOND-ROUND EFFECTS ON CONSUMERS, AS WAGE NEGOTIATIONS ARE REQUIRED.
@firstsquawkECB ACCOUNTS SHOWED A CLEAR REALITY THAT THE ENERGY PRICE SURGE IS SIGNIFICANT AND PERSISTENT, INCREASING THE RISK OF BOOSTING WIDER INFLATION.
@firstsquawkECB MEMBERS MIGHT HAVE SUPPORTED HIGHER RATES.
@firstsquawkECB ACCOUNTS SUGGEST IT'S LESS LIKELY THAT NO MONETARY POLICY ACTION WILL BE TAKEN IN THE NEAR FUTURE.
@firstsquawkECB MEMBERS SAID THE DECISION WAS CLOSE.
@firstsquawkECB ACCOUNTS SHOWED CONCERNS ABOUT THE RETURN OF UNANCHORING RISKS.
@financialjuiceECB Accounts: Upside risks to inflation and downside risks to growth had intensified.
@firstsquawkECB MEETINGS SHOWED A GENERAL AGREEMENT THAT NO STRONG SECOND-ROUND EFFECTS HAVE BEEN EVIDENCED SO FAR.
@financialjuiceECB Accounts: There was little evidence that the increase in energy prices was generating second-round effects.
@financialjuiceECB Accounts: It was now evident that the energy price shock was not only large, but also becoming more persistent, raising the risk of it feeding through into broader inflation dynamics.
@financialjuiceECB Accounts: The view was broadly shared that there was no evidence yet of strong second-round effects.
@financialjuiceECB's Simkus: Likely to support rate hike in June
@firstsquawkECB SIMKUS: "I DO THINK OF THIS AS AN INSURANCE HIKE" || "SHORT-TERM INFLATION EXPECTATIONS HAVE MOVED QUITE A BIT"
@firstsquawkSIMKUS: WOULDN'T OVEREMPHASIZE EFFECT OF HIKE ON ECONOMY
@firstsquawkECB'S SIMKUS SAYS LIKELY TO SUPPORT RATE HIKE IN JUNE
@firstsquawkECB'S SIMKUS SAYS A SECOND RATE HIKE IS MORE LIKELY THAN NOT
@firstsquawkECB'S SIMKUS SAYS TIMING OF SECOND RATE HIKE UNCLEAR AT THIS POINT
@firstsquawkECB SIMKUS: SIMKUS BACKS JUNE HIKE, SEES SECOND RATE MOVE AS "MORE LIKELY THAN NOT" || "SCENARIOS THAT WOULD LEAD ME NOT TO SUPPORT A HIKE ARE UNLIKELY" || AFTER JUNE, ECB SHOULD COLLECT DATA, NOT FEEL IT HAS TO ACT AGAIN IMMEDIATELY
@financialjuiceECB's Simkus: Timing of second rate hike unclear at this point
@reutersbizECB must act on inflation sooner rather than later, policymaker Pereira says