JACKSON HOLE , Aug 27 — It may be too early for the European Central Bank to pause interest rate hikes now as an early stop in the fight against inflation could force the bank to exert even more pain on the economy later, Latvian policymaker Martins Kazaks said on Saturday.
Markets see a roughly 50 per cent chance of another hike in September but a move by the end of the year is seen as very likely. Even if the ECB opts for a hold, it needs to make clear that its job is not yet done and more policy tightening could be on the cards, Kazaks added. Industry is already in recession and services are also softening, with both survey and hard indicators coming below expectations.
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