ECB's Nagel says inflation has not been defeated yet

FRANKFURT (Reuters) - The European Central Bank must keep interest rates sufficiently high for long enough because inflation in the euro zone has not been conquered despite a significant fall in the past year, ECB policymaker Joachim Nagel said on Tuesday.

"Our tight monetary policy is working, but we must not let up too soon," Nagel, the Bundesbank's president, said in remarks prepared for delivery at an economic think-tank in Berlin. "Rather, the key interest rates will have to remain at a sufficiently high level for a sufficiently long time."

He said it was too early to say whether rates had reached their peak, despite several of his colleagues saying they hoped last month's hike would the ECB's last and one even talking about a possible cut next year.

Prices rose by just 2.9% in the euro zone in October, their slowest pace since July 2021, and a measure of inflation that excludes energy, food, alcohol and tobacco recorded also fell, data showed earlier on Tuesday.

(Reporting By Francesco Canepa; Editing by Tomasz Janowski)

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