ECB’s Rehn Sees QT Starting in 2023 Once Neutral Rate Is Reached

The European Central Bank is likely to begin the process of shrinking its balance sheet next year, once it’s raised borrowing costs to a point that they no longer stimulate the economy, according to Governing Council member Olli Rehn.

“Once we have reached roughly the neutral level of policy rates, we will start the balance-sheet adjustment,” the Bank of Finland chief said Friday in a speech in Washington. “In my view, in the first half of next year.”