European Central Bank (ECB) policymaker Robert Holzmann says the central bank needs to raise interest rates three times this year to fight inflation.
Holzmann expressed his view in an interview with the newspaper Salzburger Nachrichten that it is desirable to increase the rate by at least two or three times.
He also said even with a smaller increase like 0.25% in each decision, it would return deposit rates for banks in a positive direction by 2023 which is currently at -0.5%.
Meanwhile, Holzmann also acknowledged that the central bank should have taken earlier action to curb inflation. Still, he thinks it is appropriate for the ECB to act later after the US Federal Reserve.
In addition, he also said that the central bank was not chasing the exchange rate target as the US dollar is now much stronger against the euro. However, they will observe it carefully and take those factors into account in their decisions.
Of late, some ECB policymakers have become vocal about efforts to normalize monetary policy more quickly than previously expected.
This makes more and more analysts see that the central bank will raise interest rates as soon as possible in July.
