Martin Kazaks, a member of the European Central Bank, emphasized that any further reduction in interest rates will be very limited, noting that potential future adjustments to interest rates will not be significant in size or impact.
These statements come at a time when expectations about the future path of monetary policy in the Eurozone are increasing, amid ongoing monitoring of the euro exchange rate developments and its potential impact on exports.
Kazaks confirmed that further strong gains in the value of the euro, which may exceed 10%, alongside similar tariff impositions, could be sufficient factors to directly harm European exports, complicating the landscape for monetary policy makers.
He clarified that any future movements in interest rates by the European Central Bank will be carefully calculated, aimed at maintaining a balance between supporting growth and containing inflationary pressures without causing a disruption to the competitiveness of exports.
Kazaks' statements come within the context of ongoing discussions within the European Central Bank about the next stage of monetary policy, amid a relative decline in inflation and signs of slowing growth. However, Kazaks believes that any new decisions regarding interest rate cuts will not be significant but rather limited in impact and subject to careful assessment of macroeconomic data and the behavior of the euro in currency markets.
These statements confirm that the European Central Bank does not intend to take swift or sudden steps regarding interest rates; instead, it prefers a gradual and balanced approach that reflects its commitment to stabilizing the Eurozone. At the same time, the rise of the euro remains a key factor in monetary policy calculations, and it may have a clear impact on the likelihood of taking further easing steps in the future.
