ECB Vice-President discusses monetary policy outlook and risks

Luis de Guindos, Vice-President of the European Central Bank (ECB), conducted an interview on 6 February 2026, discussing the economic outlook, risks, and monetary policy stance.

The economy has proven more resilient than projected, with first quarter growth likely exceeding expectations. Headline inflation is at 1.7%, and core inflation is declining towards the ECB’s target. Risks include geopolitical tensions and increased Chinese exports affecting inflation and growth.

The ECB considers current interest rates appropriate and maintains an open-minded approach to future policy adjustments. Downside risks are emphasized, but risks are balanced overall.

De Guindos clarified that the term “good place” refers to the economy and inflation moving in the right direction, not a static situation. He noted that markets understand the ECB’s stance, and communication is clear.

The ECB’s stance has not changed since December, and the possibility of rate hikes remains data-dependent. Market expectations for the first rate hike are currently in the second half of 2027, which the ECB considers as signals rather than guidance.

Latest inflation data for January aligned with expectations, with energy prices lower than anticipated and services inflation moving in the right direction. The ECB monitors credit standards closely, noting slight tightening for firms and full transmission for mortgages.

Geopolitical risks, including trade tensions and US tariffs, have receded but remain a concern due to volatility. The impact of Chinese exports on inflation is expected to materialize over time, with projections remaining consistent with current assumptions.

Indicators suggest wage growth moderation, and the euro’s recent appreciation is monitored but not targeted. The ECB emphasizes the importance of fiscal discipline, especially regarding Germany’s expansionary plans and increased defense spending, to maintain market stability.

De Guindos praised Kevin Warsh as a knowledgeable and independent candidate for Federal Reserve Chair and highlighted Boris Vujčić’s experience as ECB Governor. He expressed hope for greater gender balance in future ECB appointments.

For more details, visit the official ECB press release.