Finance
Major inflation shift needed for ECB rate change debate, says Kazimir
Published by Global Banking & Finance Review®
Posted on February 9, 2026
2 min readLast updated: February 9, 2026
Quick Summary
Kazimir states ECB needs a major inflation shift for policy change, with current policy steady amid economic uncertainties and euro appreciation impacts.
Kazimir: ECB Requires Significant Inflation Shift for Policy Change
ECB's Current Policy and Inflation Outlook
FRANKFURT, Feb 9 (Reuters) - A major deviation in economic and inflation trends would be needed for the European Central Bank to consider changing policy, Slovak central bank chief Peter Kazimir said on Monday, just days after the bank kept interest rates unchanged.
The ECB has been on hold since ending a rate cuts spree in June, arguing that inflation will hold around its 2% target, boosting market bets that policy will be steady all year before possible rate hikes next year.
"Looking forward, it would take a major departure from our baseline scenario for me to consider recalibrating the policy setting," Kazimir, who is generally considered a policy hawk, said in a blog post. "For now, the baseline holds."
Inflation Risks and Economic Factors
The ECB's policy debate has been in an unusually narrow range in recent months, with nearly all public speakers voicing a similar view, even if some have warned that downside risks to inflation remain and this could eventually unsettle the ECB's "good place" narrative.
Impact of Euro Appreciation
Kazimir repeated the ECB's view that inflation risks are balanced but argued that this hinged on favourable energy price developments.
Stronger economic growth could put upward pressure on prices while a further appreciation of the euro could be a drag, since that lowers import costs.
"Any further appreciation will have to be evaluated against the relative strength of the euro area's economic performance and ultimately our medium-term inflation target," he said.
In any case, uncertainty remains exceptionally high, volatility is likely to persist in the coming months and the overall situation is fragile, Kazimir added.
(Reporting by Balazs Koranyi; Editing by Toby Chopra)
Key Takeaways
- •ECB needs a significant inflation shift for policy change.
- •Current policy holds steady with interest rates unchanged.
- •Kazimir emphasizes balanced inflation risks.
- •Euro appreciation impacts inflation and import costs.
- •Economic uncertainty and volatility remain high.
Frequently Asked Questions about Major inflation shift needed for ECB rate change debate, says Kazimir
1What is inflation?
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power.
2What is the European Central Bank?
The European Central Bank (ECB) is the central bank for the euro and administers monetary policy within the Eurozone.
3What is monetary policy?
Monetary policy refers to the actions taken by a central bank to control the money supply and interest rates to achieve macroeconomic goals.
4What is economic growth?
Economic growth is the increase in the production of goods and services in an economy over a period of time.
5What is a policy hawk?
A policy hawk is a member of a central bank or financial institution who advocates for tighter monetary policy to control inflation.
