(Bloomberg) -- The European Central Bank should stick to lowering borrowing costs at a gradual and measured pace, Governing Council member Madis Muller said, pushing back against suggestions by some of his colleagues to consider bigger steps.
“With increased confidence in reaching our target it makes sense for us to keep gradually cutting interest rates, moving at a measured pace,” Muller said in an interview in Washington. “I’m not worried about falling behind the curve.”
The ECB has lowered rates three times since June and another move in December is highly likely. What’s less clear is by how much policymakers are prepared to cut after President Christine Lagarde suggested inflation might retreat faster than thought.
Mario Centeno, Portugal’s member on the ECB’s Governing Council, has called for a 50-basis point step to be considered amid concerns that a weakening labor market will damp already sluggish consumption and thus price pressures in the euro zone. Others, including Germany’s Joachim Nagel said the ECB shouldn’t hurry too much.
“The growth outlook is a bit weaker than it was a few months ago, but I’m still confident we’ll see a gradual recovery,” said Muller, who heads Estonia’s central bank.
Gradually removing the shackles from the economy will help to achieve such a result, he said.
“Right now we acknowledge that policy is still restrictive,” Muller said. “Once we’re confident that we’ve met our target that will change.”
©2024 Bloomberg L.P.