Stournaras Warns ECB Against Hasty Rate Moves Amid Ongoing Inflation Risks

European Central Bank (ECB) Governing Council member Yannis Stournaras warns that policymakers should remain vigilant about inflation risks but avoid acting hastily. Speaking to Bloomberg, Stournaras noted that while there are positive signs, such as the absence of second-round wage effects, policymakers cannot take current stability for granted.

Stournaras highlighted the ongoing supply-side shocks and demand pressures from fiscal expansion and artificial intelligence investment sector growth as reasons for caution. Central bank officials are evaluating their next policy steps to guide inflation back toward the 2% target from its current level above 3%, following two interest rate increases since the outbreak of war in Iran.

With more than a month remaining before the next monetary policy meeting, Stournaras indicated that upcoming economic projections from ECB staff will serve as a key guide for decision-making. He stated that an October rate increase could not be ruled out if energy costs surge or September inflation data accelerates into an adverse scenario.