- There’s a positive underlying momentum in the economy
- Food price inflation is still strong
- I’m still seeing stickiness in services inflation (came down from 4% but still above 3%)
- Inflation risks are tilted a little bit to the upside
- Can tolerate small deviations from inflation target in either directions (repeated by most ECB members)
- The main focus should be on core inflation
- Not seeing sustained disinflationary pressures
- Interest rates are absolutely in a good place
Schnabel has been leaning on the hawkish side as she recently said that rate hikes could come earlier than people expected. She’s also one of the most influential ECB policymakers, so her views grab the market attention. Given her stance though, hawkish comments aren’t seen as surprising.
This article was written by Giuseppe Dellamotta at investinglive.com.