European Central Bank policymakers agreed to keep the option open of another interest rate rise, even if it was not part of their “baseline scenario”, when they met last month.
Stressing the need to be “both persistent and vigilant”, ECB governing council members meeting in Athens a month ago recognised they had “to avoid an unwarranted loosening of financial conditions”, according to the official account of the decision published on Thursday.
Since that gathering, when the ECB ended an unprecedented 10 consecutive rate increases, several council members have declared that they will need to keep borrowing costs high for a prolonged period to bring inflation down to their 2 per cent target. They have said that the “last mile” will be the hardest.