ECB needs to do more to contain inflation pressures, Kazimir says
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FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
June 15 (Reuters) - The European Central Bank has taken the first step to contain price pressures, but it is increasingly clear that more needs to be done, Slovak central bank chief and ECB policymaker Peter Kazimir said on Monday.
The ECB raised interest rates for the first time in nearly three years on Thursday in an effort to curb inflation before a surge in energy costs triggered by the U.S.-Israeli war on Iran spreads more broadly across the euro zone.
"This is no time for complacency and hesitation," Kazimir said in an opinion piece.
"Higher energy costs are likely to remain with us longer than many had hoped. Even with the just-announced U.S.-Iran peace framework, the damage in the Middle East cannot be undone overnight."
Second-round effects of energy price rises would materialise without the ECB's action, he said.
"We have taken a first step towards containing medium-term price pressures," he said. "But the mission is not complete. With today's information, it is increasingly evident that monetary policy has more work to do."
(Reporting by Jan Lopatka in Prague; Editing by Thomas Derpinghaus)
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