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Austria's new interest rate strategy: Kocher fights against high inflation!
Martin Kocher leads the OeNB in an inflation crisis, emphasizes stability and pursues price stability goals for Austria.
Austria's new interest rate strategy: Kocher fights against high inflation!
When taking over the management of the Oesterreichische Nationalbank (OeNB), Martin Kocher faces a complex challenge: high inflation rates and a tighter interest rate policy require targeted measures. Loud Leadersnet The OeNB's main goal is to maintain price stability in the euro area, which is currently under pressure with a target inflation of 2% for 2025.
Kocher's assessment of inflation is clear: While the European Central Bank (ECB) has a forecast of 2.1% for 2025, inflation of 3.5% is expected in Austria, which is expected to fall moderately in the following years to 2.4% in 2026 and 2.3% in 2027. Kocher recognizes both structural and international factors as the main causes of this discrepancy.
Interest rate policy challenges
The Eurosystem's interest rate policy, as set by the ECB, plays a crucial role in controlling inflation. The Governing Council meets every six weeks to adjust the main refinancing rate, the deposit rate and the marginal lending facility rate accordingly. Currently, these interest rates remain at 2.15% for main refinancing operations, 2.00% for the deposit facility and 2.40% for the marginal lending facility, as on OeNB can be read.
Kocher emphasizes that the OeNB cannot take national measures to reduce inflation in the current situation. Nevertheless, she supports us with analyzes and recommendations. For Kocher, the independence of central banks is a fundamental principle in order to avoid inflation and economic instability.
Economic prospects
With regard to the risks to the Austrian economy, Kocher cites volatile energy prices, geopolitical uncertainties and the shortage of skilled workers. These challenges should not be underestimated, but they also offer opportunities: investments in new technologies, digitalization and innovation could stabilize the economic situation in the long term.
The ECB recently forecast a positive development in economic growth, with a revision of the growth forecast for 2025 to 1.2%. This adjustment could serve to maintain price stability, with the ECB aiming for an inflation target of 2% by 2027, as reported in the ECB's current figures: 1.7% for 2026 and 1.9% for 2027. ECB
With his experience as a minister and head of the IHS, Kocher would like to position the OeNB as a competent, independent voice in economic and financial policy matters. Despite the billions in losses recorded over the last two years, the OeNB's financial strength remains stable and the central focus is on inflation expectations.