© Reuters. FILE PHOTO: Senior Deputy Governor of the Bank of Italy, Fabio Panetta is seen standing in a corridor of the Bank of Italy ahead of his appointment to the European Central Bank’s executive committee, in Rome, Italy. September 26, 2019. REUTERS/Remo Casill
FRANKFURT (Reuters) – The European Central Bank should avoid raising interest rates too fast because that could excessively hurt economic growth, home prices and the financial markets, ECB board member Fabio Panetta said on Thursday.
“If these bigger-than-expected increases are interpreted as signalling a higher terminal rate, rather than simply frontloading the normalisation, we could have a stronger impact on financing conditions – and ultimately on economic activity – than intended,” Panetta told an ECB event.