ECB’s De Cos Says Rates at 4% Should Get Inflation to 2% Goal

Euro-area inflation should return to the European Central Bank’s goal if borrowing costs are maintained at their current state for some time, according to Governing Council member Pablo Hernandez de Cos.

“If we keep rates at these levels long enough, there are very good chances that we will be able to reach our 2% target in a timely manner,” de Cos told a conference in Madrid on Monday. “This approach is particularly important to avoid both insufficient tightening, which would impede the achievement of our inflation target, and excessive tightening, which would unnecessarily damage economic activity and employment.”