There are not yet enough indications that the euro zone’s inflation could drift further down or up to change the European Central Bank’s central scenario for further rate cuts, ECB board member Jose Luis Escriva said in an interview with the Spanish newspaper Expansion on Tuesday.

Escriva, who is also the governor of the Bank of Spain, was asked about risks raised before the October 17 rate cut that inflation could come under too much pressure and end up even below the central bank’s target of 2%.

“At the moment, the data suggests that we are approaching the inflation target broadly in line with the path envisaged in the September macroeconomic projections,” Escriva said.

He added that the balance of risks included in the ECB’s latest projections following its decision five days ago contemplated inflation turning out “somewhat higher than expected and the opposite.”
However, Escriva said there weren’t yet signs of additional risks that could make inflation fluctuate any further from the ECB’s current diagnosis.

Asked about the likelihood that interest rates will be lowered again in December or remain unchanged, he said “everything will have to be assessed and decided at that time”, stressing the importance of keeping a flexible and data-dependent attitude.

He added that any estimates of the so-called neutral interest rate were insufficiently robust, subject to a high level of uncertainty and “of limited usefulness for the conduct of monetary policy.”