ECB must be prudent with rates hikes as recession risk is rising: Panetta

By Thomson Reuters Aug 23, 2022 | 7:15 AM

FRANKFURT (Reuters) – The European Central Bank may need to raise interest rates further but must be prudent with policy moves as the risk of a recession is on the rise, ECB board member Fabio Panetta said on Tuesday.

“The probability of a recession is increasing,” Panetta told a financial conference in Milan. “If we will have a significant slowdown or even a recession, this would mitigate inflationary pressures.”

“I think that (policy) adjustments are possible but the most recent evolution of the economy should induce us to exercise one of the main features of central bankers which is prudence.”

(Reporting by Balazs Koranyi; Editing by Alex Richardson)