Visco, we don’t know where we’ll end up with rates
The words of the governor of the Bank of Italy Ignatius Visco to Bloomberg TV they risk making the antennas rise, first of all the markets. The ECB will raise rates to the extent necessary to ensure a return to inflation. But “we cannot now indicate what the final rate will be, whether 3.5%, 3.25% or 3.75%because it really depends on the data”, warned the governor of Bank of Italy.
“Our goal is to return to 2% inflation over the medium term. If we have to be more restrictive, we will be more restrictive,” continued Visco. The governor also called the “gradual reduction” of the bonds in the portfolio that begins in March “necessary”.
- Read also: Mess Mps, Governor Visco is under investigation in Brescia
“2% inflation target”
“Significantly is a term that has several meanings,” Visco said after the president of the Bundesbank Joachim Nagel he had called for “several significant hikes”. “My interpretation is ‘determined’, not great,” explained Visco.
The governor of Bank of Italy also discussed the core inflation (excluding food and energy) at record levels in February. “We need to make sure that core inflation doesn’t stay at these elevated levels”, he said, alluding to wage increases in some member countries of the euro area. “This could lead to wage increases that go beyond what is compatible with a 2% inflation target over the medium term. That’s why we are observing the situation very carefully, but I’m not worried ”, she concluded.
The Visco article warns: “It is impossible to say how much we will raise rates” comes from Verità e Affari.