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ECB’s Makhlouf Says No Need to Rush Interest-Rate Cuts

Gabriel Makhlouf, governor of the Central Bank of Ireland, at the Central Bank of Ireland Financial Systems Conference in Dublin, Ireland, on Wednesday, Nov. 8, 2023. Speaking at the conference Bank of England Governor Andrew Bailey warned fragmentation of the global economy poses a risk to financial stability and called on regulators around the world to pursue common policy objectives. (Paulo Nunes dos Santos/Bloomberg)

(Bloomberg) -- European Central Bank Governing Council member Gabriel Makhlouf said officials shouldn’t hurry in loosening monetary policy.

“It is important to assess conditions carefully and pace yourself,” the Irish central-bank chief said Friday in a speech. “And with the finish line in sight, we don’t need to rush to it. In my view, a prudent and cautious approach remains the right one.”

Commenting on inflation, he said increases in the services gauge of around 3% would be more consistent with the goal of 2% for the headline reading. Services prices rose 3.9% from a year ago in October.

ECB policymakers are preparing for their final rate meeting of the year next month, with a quarter-point cut seen by investors as the most likely outcome. Talk of a bigger move has subsided after better-than-expected economic data for the third quarter, though risks to growth remain — not least from US trade tariffs should Donald Trump follow through on campaign vows when he takes over again as president.

“I expect a fragmenting global economy undergoing significant transitions — in demography, in technology, in climate — to mean that volatility and uncertainty will reflect a new normal, posing challenges to all economic policymakers,” Makhlouf said.

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