Message of interest rate hike from Europe's hawkish name

Joachim Nagel, one of the hawkish names of the European Central Bank, said that an interest rate hike was needed at the July meeting and that more data needed to be seen for the September meeting. European Central Bank Executive Board Member and Bundesbank President Joachim Nagel said that the European Central Bank should raise interest rates again this month and that it would base its decision on data at the next meeting. Nagel, known as one of Europe’s hawkish names, said, “We have to raise rates next time and I expect another 25 basis points increase for the July meeting. We’ll see what the data tells us for the September meeting.” Speaking to Bloomberg TV in Gandhinagar, India, where he was attending the G-20 meetings, Nagel described the underlying inflation as “very sticky.” Stating that, “Core inflation for more or less all developed countries is not falling as it perhaps has in past cycles,” Nagel again referred to inflation as a “greedy beast.” While markets and economists are predicting interest rate hikes next week and in September, with the deposit rate expected to rise from 3.5% to 4%, officials appear to have reached no consensus on the path forward. Some members, including Nagel, say another move should not be ruled out, while others are concerned about the future of the 20-nation eurozone economy, which entered a mild recession over the winter.