Investing.com -The European Central Bank (ECB) is not finished with increasing borrowing costs, but it doesn't have much more to do, according to Executive Board member Fabio Panetta in an interview with Le Monde.
Panetta believes that now is not the right moment for aggressive moves since significant progress has already been made. He stated that although the final goal hasn't been reached yet, it's not too far off.
So far, policymakers have tightened monetary policy by 375 basis points. As they face inflation rates that are decelerating but still remain worryingly high, officials anticipate further quarter-point interest rate hikes this month and in July.
Despite being one of the Governing Council's more cautious members, Panetta acknowledged the issue of elevated inflation but reassured there was no cause for alarm. He added that the effects of their monetary tightening measures would be felt in upcoming months. However, Panetta also mentioned that weak domestic demand could persist and potentially lead to a prolonged slowdown or even a technical recession within the eurozone economy.