Members of the European Central Bank (ECB) Governing Council and Bank of Estonia Governor Madis Muller told Econostream in an interview published on Thursday that the available data does not provide enough evidence the former institution should cut its interest rates back-to-back in June and July.
Muller also voiced his opposition to a 50 basis points (bps) reduction in June. "Even with developments more or less in line with what we expected in the latest projections, for example, we still cannot claim complete victory over inflation," he said.
"That's why it's reasonable to start with a 25 bp cut in June, and thereafter to see how actual developments look in terms of inflation, growth and all the other key variables before taking our next decision based on these," Muller noted. "Especially as we are starting wth rate cuts while inflation is still above our target."
