ECB's Schnabel: Agrees with market expectations that the central bank's next move will be a rate hike

According to Jinse Finance, European Central Bank Executive Board member Isabel Schnabel has expressed agreement with investors betting on the ECB’s next rate hike. Schnabel stated that borrowing costs are already at a level that will remain appropriate for some time unless new shocks occur, and that consumer spending, corporate investment, and significant government spending on defense and infrastructure will continue to boost the economy. The German hawk pointed out that economic and inflation risks are skewed to the upside. She hinted that at the December meeting, new economic growth forecasts may be revised upward, and analysts expect the deposit rate to be held at 2% for the fourth time. Schnabel is the first ECB policymaker to explicitly state that borrowing costs have not only reached an “appropriate level” (as President Lagarde and other ECB officials have repeatedly emphasized), but have reached their lower bound. (Jin10)