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Simkus (ECB) for a rate hike of 75 basis points in October


Simkus (ECB) for a rate hike of 75 basis points in October |  Photo credits: Istock

Simkus (ECB) for a rate hike of 75 basis points in October | Photo credits: Istock

FRANKFURT, Sept 29 (Reuters) – Gediminas Simkus, Chairman of the Board of the Bank of Lithuania, said on Thursday it would be better if the European Central Bank (ECB) raised its key rates by 75 basis points in october.

The bank has raised its rates by 125 basis points over its last two monetary policy meetings and has pledged to continue their rise as inflation in the euro zone approaches 10%.

“My choice would be 75 (basis points),” Gediminas Simkus told Bloomberg TV. “I understand options may be on the table but 50 is the minimum.”

Asked about a one percentage point increase, Gediminas Simkus replied that it would be “definitely too much”, echoing similar comments from some of his colleagues.

Madis Mueller, the governor of the Bank of Estonia, considers that it is necessary for the ECB to proceed to a further “significant” increase in its rates. He believes that the institution should also open the debates fairly quickly on the reduction of its balance sheet.

“Given the level of inflation as it currently stands and the outlook, a further significant hike is in order. It is still too early to say exactly how much this will be in terms of basis points “, he also told Bloomberg TV.

Several central bank officials have spoken lately about the possibility of a three-quarter point hike next month. (Report Balazs Koranyi, French version Laetitia Volga, edited by Kate Entringer)





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