Bundesbank President Weber says that raising interest rates preemptively can be justified even if inflation is low. He says he is not speaking about the current environment, but speaking theoretically.
Rates are presently in-line with the ECB inflation outlook, he says while noting he expects long-term rates to fall further. He also sees a brighter outlook for international markets.
Weber is not talking rate hikes now, but I’d suspect it won’t be long before he pleads with his colleagues to empty the punch bowl…
EUR/USD is consolidating around 1.4105. Offers are eyed toward 1.4150/70 while central bank bids are seen on dips to the 1.4050 area.