ECB Governing Council member Dimitar Radev said that before judging whether previous rate hikes are effectively curbing inflation, policymakers should not rush to take further action. Speaking at the MNI Connect video conference on Thursday, the Bulgarian central bank governor stressed that this month's rate hike does not mean that the ECB has “embarked on a pre-set policy path.” “Patience is still important, but vigilance should be slightly more important,” Radev said. “This is not a call for automatic policy tightening, but rather means that we should allow time for previous policy decisions to take effect, and also be prepared to take countermeasures if evidence shows that inflation is more sustainable.” The above remarks show that compared to what some policymakers proposed to act again as early as October 29, Radev may prefer to wait until the ECB's December meeting to decide whether to raise interest rates further. At that time, the ECB will publish quarterly economic forecasts to provide more information for officials to make decisions. Radev said that the ECB is currently unable to fully determine whether the sharp rise in energy costs caused by the Middle East war will be limited to the energy sector or spread to other sectors of the economy. However, he pointed out that there are currently no “widespread second-round effects.” “Inflation is still above our target, and the energy shock is likely to last longer than initially anticipated,” Radev said. “At the same time, the Eurozone economy has shown greater resilience than many had anticipated. The task now is to determine whether this round of shock will continue to be largely confined to the energy sector, or whether it will become more enduring and spread widely.”

ECB Governing Council member Dimitar Radev said that before judging whether previous rate hikes are effectively curbing inflation, policymakers should not rush to take further action. Speaking at the MNI Connect video conference on Thursday, the Bulgarian central bank governor stressed that this month's rate hike does not mean that the ECB has “embarked on a pre-set policy path.” “Patience is still important, but vigilance should be slightly more important,” Radev said. “This is not a call for automatic policy tightening, but rather means that we should allow time for previous policy decisions to take effect, and also be prepared to take countermeasures if evidence shows that inflation is more sustainable.” The above remarks show that compared to what some policymakers proposed to act again as early as October 29, Radev may prefer to wait until the ECB's December meeting to decide whether to raise interest rates further. At that time, the ECB will publish quarterly economic forecasts to provide more information for officials to make decisions. Radev said that the ECB is currently unable to fully determine whether the sharp rise in energy costs caused by the Middle East war will be limited to the energy sector or spread to other sectors of the economy. However, he pointed out that there are currently no “widespread second-round effects.” “Inflation is still above our target, and the energy shock is likely to last longer than initially anticipated,” Radev said. “At the same time, the Eurozone economy has shown greater resilience than many had anticipated. The task now is to determine whether this round of shock will continue to be largely confined to the energy sector, or whether it will become more enduring and spread widely.”