ECB’s Schnabel Says Rate Hike to Tame Inflation May Come in July

(Bloomberg) -- European Central Bank Executive Board Member Isabel Schnabel said it’s time for policy makers to take action to tame inflation, and that an interest-rate hike might come as early as July.

“It’s not enough to talk now -- we have to act,” she said in an interview with German newspaper Handelsblatt published Tuesday. “From today’s perspective, I think a rate hike in July is possible.”

Schnabel’s remarks come few days after ECB Vice President Luis de Guindos pinpointed July as a possible moment for a lift-off in interest rates, though he had said it’s not “likely.” Other policy makers have also mentioned that a rate hike could come early in the third quarter. Schnabel is considered one of the Executive Board’s most influential members.

The 50-year old German argued that inflationary pressures are “broadening,” after consumer prices jumped by a record 7.5% in April, and that the central bank must “prevent high inflation from taking hold in expectations.”

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