Nagel (President of the Bundesbank): Soon after June, the first interest rate increase by the ECB in 10 years

The European Central Bank will soon raise its key interest rate for the first time in more than 10 years, a member of the Board told CNBC. of the central bank of the euro area Member States.

“We are on the right track,” said Joachim Nagel, chairman of the German Federal Reserve (Bundesbank) and one of the strongest supporters of “tightening” monetary policy on the board. of the ECB.

The latter has been the focus of attention for its less aggressive trend in interest rates, relative to other central banks, such as those of the US and the United Kingdom.

However, the prevailing feeling is that eventually the ECB will also increase, given the galloping inflation, with the market now pricing at least four increases by the end of the year.

“At our very important meeting in March, we decided to put an end to our asset purchases and at the June meeting, depending on the data, we will probably decide to stop immediately – I think the details will be quite clear – so “After the end of the quantitative easing, we will probably see the first interest rate hikes soon,” said the German central banker.

Based on his comments, it concludes that the first interest rate hike by the ECB is likely to occur in July, as its executives will have discussed last month’s updated financial forecasts.

Nagel, who has been head of the Bundesbank since January, said he had warned of high inflation early in his term and now sees other colleagues at European level moving towards his positions.

His remarks follow those of his French counterpart, Francois Villeroy de Galhau, who said he expects the ECB to raise interest rates gradually from the summer onwards.

Their Italian counterpart, Ignazio Visco, for his part, one of the key “pigeons” within the ECB, posted the first rate hike “perhaps in the third quarter of the year or towards the end of the year, but it should be gradual “.