New European Central Bank Governing Council member Marko Kranjec told Reuters on Tuesday that he is a hawk and a great opponent of inflation. Slovenia's parliament voted Kranjec in as head of the country's central bank late on Tuesday, and with that he takes his country's seat on the ECB's rate-setting Governing Council.
"I can openly say I'm a great opponent of inflation, I'm a hawk as far as that is concerned," Kranjec told Reuters in a telephone interview just after being appointed. "The Bank of Slovenia, like all central banks in the Eurosystem ... will lead a sharp anti-inflation policy. There can be no withdrawal there," he continued.
"It is the purpose of interest rates to be restrictive. If it becomes clear that inflationary pressures are too big then rates have to play that role. (They) have to restrict and that is the purpose of this policy," he explained. The ECB's benchmark interest rate currently stands at 4 percent. Analysts expect it to rise to 4.25 percent in September, but are much less sure if the ECB will tighten policy thereafter.
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