Interview with Isabel Schnabel, Member of the Executive Board of the ECB, conducted by Johanna Treeck on 20 April 2023

24 April 2023

Since the last policy meeting, core inflation rose along with market-based inflation expectations and still some of your colleagues say that we should slow tightening. Is that also your view or are you open for another 50-basis point move in May?

Let me start with my general view on recent inflation developments. We are seeing a change in the drivers of inflation. It started with supply-side shocks – bottlenecks and rising energy prices –, which are now fading, while at the same time the demand-side factors are gaining importance. The macroeconomy has proven quite resilient. Industrial production is expanding. The services sector is recovering pretty quickly and wage growth is picking up. What happens to inflation is going to depend on the relative importance of these different factors.

Headline inflation is coming down relatively quickly, due to…