The European Central Bank must take its time to get interest rate cuts right, its chief economist, Philip Lane, said Thursday.
“A lot of evidence is accumulating, but what’s also fair to say is that the transition from this holding phase, we’ve been on hold since last September since a substantial hiking cycle, we do have to take our time to get that right, from holding to dialing back restrictions,” Lane told CNBC’s Steve Sedgwick.
Lane said the euro zone central bank’s March meeting had been an “important milestone” in the accumulation of evidence, which showed the “disinflation process has been ongoing.” During the meeting, the ECB held rates and released updated macroeconomic projections, which lowered its inflation forecast for this year to 2.3% from 2.7%.
“We’ve continued to make progress, we continued to move towards our 2% target,” Lane said Thursday.
Inflation in the 20-nation bloc eased to 2.6% in February.
In line with the ECB’s March messaging, Lane said that more data was required, particularly around wages, and that the institution would “learn a lot by April, a lot more by June.”
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