European Central Bank Governing Council member Kazaks (governor of Latvia’s central bank) spoke on Thursday. He led with saying he’s very much open to a discussion on a September rate cut, and that even with a couple more cuts the Bank’s monetary policy would still be restrictive.
A gradual approach to rate cuts would be best.Cuts are possible even if inflation goes sidewaysServices inflation has been stubbornThe Bank is still on the path to the 2% inflation target next year
Kazaks added that he is worried by the weakness showing in the European economy, and that a lack of structural improvements are holding back growth.
This article was written by Eamonn Sheridan at www.forexlive.com.
