The President of the Bundesbank and member of the Governing Council of the European Central Bank (ECB), Joachim Nagel, considers that there are solid reasons to approve a new increase in interest rates next month in December in order to contain inflation.
"It seems quite obvious that we need to do something more than what we have already done," Nagel commented in an interview with BloombergTV, where he described the price increase in the region as "too high," adding that the institution’s decision will be guided by the new forecasts, which will reach up to 2029.
"With these new figures, we will have more clarity," the German central banker argued, for whom the ECB’s current monetary policy is "at the upper limit of neutrality" and, if the inflation data are much higher than the entity’s target, restrictive measures would have to be adopted.
At her press conference last October 29, after the Governing Council of the ECB decided to keep interest rates unchanged, the head of the entity, Christine Lagarde, already indicated that, "unless there is a major development, the direction we will take is fairly clear to everyone," hinting at the central bank’s willingness to raise rates at its last meeting in 2026.
If a quarter-point increase in December were confirmed, the benchmark interest rate, applied to the deposit facility, would rise to 2.75%, accumulating three increases since the start of the conflict in the Middle East.
This Tuesday, the governor of the Federal Reserve, Christopher Waller, has expressed his support for an interest-rate hike by the US central bank in December, adding that he could consider a half-point increase if inflation does not show signs of moderation.