ECB/Makhlouf: If interest rate hikes are needed, smaller hikes will be made

“If further rate hikes are needed next year, they will be smaller,” said Gabriel Makhlouf, a member of the European Central Bank and president of the Central Bank of Ireland. If further rate hikes are needed next year, the ECB is likely to move to smaller rates. Markets are pricing in a 50 to 75 basis point hike when the ECB meets on Dec. 15. Makhlouf said last week he was open-minded about the size of the hike. “There is a possibility that interest rates will go up next year, but they will go up in smaller amounts,” he told the Sunday Independent newspaper yesterday. “We need to look at what happens in the eurozone economy to decide how much further rate hikes we need. I think we will see inflation coming down in the second half of next year,” Makhlouf said.