Published by Global Banking & Finance Review®
Posted on January 23, 2026
2 min readLast updated: January 23, 2026
Add as preferred source on GoogleMartin Kocher of the ECB advises caution in policy changes amid rising geopolitical uncertainty, stressing the importance of not acting prematurely.
FRANKFURT, Jan 23 (Reuters) - The European Central Bank must be cautious in adjusting policy preemptively to mitigate uncertainty, Austrian central bank chief Martin Kocher told German media outlet Platow in an interview published on Friday.
Geopolitical uncertainty has increased sharply this month, partly on threats by U.S. President Donald Trump that he would take over Greenland and impose punitive tariffs on nations not going along with his plan.
But Kocher said he would be cautious in acting before risks actually materialised, especially if inflation risk were not clearly skewed in one particular direction.
"I would be cautious," Kocher said. "Some risks can be addressed in advance, but many cannot, because otherwise one commits to a course of action too early and communication becomes difficult."
He added risks had "shifted slightly to the positive" in the past six months, with slightly stronger growth expectations for the eurozone and stable financial markets.
"Now we have new developments again, but I would not reinterpret the initial situation within a week," Kocher said.
Markets currently expect no action from the ECB and see steady rates throughout 2026.
(Reporting by Balazs KoranyiEditing by Francesco Canepa)
Monetary policy refers to the actions taken by a central bank to manage the money supply and interest rates to achieve macroeconomic objectives such as controlling inflation and stabilizing currency.
The European Central Bank (ECB) is the central bank for the eurozone, responsible for managing the euro and implementing monetary policy for the member states of the European Union that use the euro.
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is typically measured as an annual percentage increase.
Financial markets are marketplaces where buyers and sellers engage in the trade of assets such as stocks, bonds, currencies, and derivatives, facilitating the exchange of capital and investment.
Economic growth is the increase in the production of goods and services in an economy over a period, typically measured by the rise in real GDP (Gross Domestic Product).
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