By Sam Boughedda
Policymakers at the European Central Bank are reportedly considering a slower pace of interest rate hikes than indicated in December, according to a report by Bloomberg on Tuesday.
The 50 basis-point increase in February signaled by ECB President Christine Lagarde remains likely, but the possibility of a smaller 25-point rise in March is gaining support, said Bloomberg, citing officials with knowledge of their discussions.
However, the officials told the publication it should not be taken as a sign that the ECB is softening its mandate, and no decisions have yet been taken. In addition, policymakers could still deliver the half-point move in the March meeting that Lagarde signaled on December 15.
Inflation being weaker than expected in the euro area, natural gas prices falling, and the potential easing of tightening by the U.S. Federal Reserve have tempered policymaker concerns, and they are said to be considering how to continue the aggressive rate hikes.
The 50-point move in December did slow the pace of hikes, but the ECB was also cautious in its comments.