Yannis Stournaras suggests ECB interest rate hikes remain possible

Yannis Stournaras, a member of the European Central Bank (ECB) Governing Council and Governor of the Bank of Greece, has indicated that further interest rate hikes cannot be ruled out if inflation risks escalate. Speaking in Dublin, Stournaras noted that while the Eurozone economy has shown resilience and secondary effects on wages have not yet materialized, the situation remains uncertain.

He highlighted that consecutive supply-side shocks, such as the energy crisis, combined with strong demand driven by fiscal expansion and artificial intelligence investments, necessitate continued vigilance. Stournaras suggested that if a surge in inflation occurs in September or if energy costs rise significantly, an interest rate increase in October could be possible. However, he emphasized that the ECB should not rush into decisions and will wait for further data if there is any doubt.