ECB’s Rehn warned that underlying inflation pressures are only falling gradually

Olli Rehn is the Governor of the Central Bank of Finland and, as such, sits on the Governing Council of the European Central Bank.

From a press release issued Tuesday:

  • “The rise in consumer prices in the euro area is slowing, but not as much as it should be,”
  • “Inflation excluding energy and food is only coming down gradually.”

Ren said that a decline in this core inflation is a prerequisite for a pause in interest rate increases

  • “I can say that I consider core inflation to be a very important and fundamental measure of general judgment for making monetary policy,”

  • “It is important that core inflation is in a steady and sustainable decline.”

Ren asserted that:

  • “We will raise interest rates to levels that are sufficiently restrictive to achieve a timely return of inflation to the medium-term target of 2% and to maintain them as necessary.”

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The ECB meeting in July will bring the following rate hike for the bank:

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