ECB's Kazāks: Further Rate Hikes May Be Needed for Restrictive Territory

The European Central Bank (ECB) may need to tighten monetary policy further if its baseline scenario materializes, said ECB Governing Council member Martins Kazāks.

Kazāks, who heads Latvijas Banka, believes that if the bank's September baseline holds, it will be necessary for policy rates to enter restrictive territory. However, he noted that uncertainty is still too high to make a definitive statement at this time.

Kazāks also indicated that another interest rate increase was his central expectation rather than just an upside-risk possibility.