The European Central Bank needs more time to confirm that inflation is returning to target and cut interest rates, according to its vice-president.
“Wage pressures remain high and we do not yet have sufficient data to confirm they are starting to ease,” vice-president Luis de Guindos said in a speech in Split, Croatia, on Wednesday.
He acknowledged that inflation was “heading in the right direction”, but warned not to “get ahead of ourselves”.
“It will take some more time before we have the necessary information to confirm that inflation is sustainably returning to our 2 per cent target.”
He warned that “profit margins could also prove more resilient than anticipated”, while “heightened geopolitical tensions, especially in the Middle East, could raise energy prices and disrupt global trade”.