The European Central Bank (ECB) should be careful about taking preemptive policy action in response to rising uncertainty, Austrian central bank chief Martin Kocher said in an interview with German outlet Platow. Kocher noted that while geopolitical risks have intensified recently, central banks should avoid committing to policy moves before risks clearly materialise.
Kocher pointed to heightened global uncertainty driven partly by fresh geopolitical tensions, including threats of new U.S. trade measures. However, he cautioned that acting too early—especially when inflation risks are not clearly tilted in one direction—could lock policymakers into a difficult position and complicate communication. “Some risks can be addressed in advance, but many cannot,” he said.
He added that over the past six months, risks had shifted “slightly to the positive,” with modestly improved euro zone growth expectations and stable financial markets. While acknowledging recent developments, Kocher said it was too soon to reassess the broader outlook. Financial markets currently expect the ECB to keep interest rates unchanged through 2026.
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