Peter Kazimir, European Central Bank (ECB) Governing Council member and Governor of the National Bank of Slovakia (NBS), said during the European trading session that monetary policy does not require adjustment as risks to both inflation and the economy remain broadly balanced.
Key comments from Kazimir:
- No need to fine-tune or overengineer monetary policy.
- Small deviations from the inflation target should not be overinterpreted.
- Risks to the economy and inflation are generally balanced.
- Future policy moves could go either direction, depending on incoming economic signals.
Market reaction:
EUR/USD showed limited response to Kazimir’s remarks, trading slightly lower by 0.2% near 1.1510 at press time.
ECB Overview:
- The European Central Bank (ECB) manages monetary policy for the Eurozone, with a primary mandate of maintaining price stability (around 2% inflation).
- Its main tool is interest rates—higher rates tend to strengthen the Euro, while lower rates usually weaken it.
- The ECB also uses Quantitative Easing (QE) to inject liquidity by buying bonds, which usually weakens the Euro, and Quantitative Tightening (QT) to reduce bond holdings and support the Euro.
