ECB's Holzmann sees risk of another wave of inflation in eurozone

European Central Bank (ECB) Governing Council member Robert Holzmann has recently expressed his concern regarding risks of worsening inflation in the region. In his opinion, additional defense spending in several countries within the bloc and US trade policy are the factors that could drive consumer prices upward.

In an interview with the Wall Street Journal, Holzmann emphasized the importance of maintaining credibility with the regulator. He opposes a significant reduction in interest rates and considers it inexpedient to further stimulate the economy to achieve the inflation target of 2%. Earlier, he refrained from supporting the March decision to reduce borrowing costs, maintaining a strict stance.

The official sees no need for further stimulation of the eurozone economy. He insists on preserving the existing borrowing conditions. Explaining his position, Holzmann noted his readiness to support a collective decision in abandoning the term ‘restrictive’ in relation to the current monetary policy.