Central Banks
ECB’s Holzmann Warns Rate Cuts Aren’t Guaranteed This Year
- Expectations for easing too optimistic, he says in interview
- Geopolitical events threaten to keep inflation elevated longer
Robert Holzmann
Photographer: Michaela Nagyidaiova/BloombergThis article is for subscribers only.
Threats stemming from lingering inflation will prevent the European Central Bank from lowering interest rates this year — even as a recession can no longer be ruled out, according to Governing Council member Robert Holzmann.
The euro-zone economy has disappointed recently and will probably prove officials too optimistic once fourth-quarter results are released, Holzmann said in an interview in Davos, Switzerland, where he’s attending the World Economic Forum. At the same time, geopolitical conflicts — like the one in the Middle East — risk disrupting supply chains and energy markets, keeping pressure on prices that the ECB can’t ignore.