by Mark Schroers
BNN Bloomberg
(Bloomberg) — The European Central Bank has made significant progress in bringing down inflation but can’t declare victory just yet, according to Vice President Luis de Guindos.
“The incoming information shows that the disinflationary process is now well on track,” he said on Monday in Madrid. “The outlook, however, is surrounded by substantial risks.”
Geopolitical conflicts threatening to push up energy and freight costs, extreme weather and sticky wage growth all have the potential to keep price pressures high for longer, Guindos said at a conference. At the same time, past rate hikes might damp demand — and inflation — more than expected, with weaker global growth an added downside risk.
The Spaniard was one of just a few officials who hadn’t commented on the future interest-rate path after the ECB in mid-October lowered borrowing costs for a third time this year.