Bank of Portugal Governor Mario Centeno warned on Monday that there is a risk of the European Central Bank (ECB) "doing too much" when it comes to rate hikes.
In his annual analysis published by the Bank of Portugal, Centeno stressed that inflation "has fallen faster than it had risen and the economy is adjusting to the new financial conditions." He added that, once the "convergence towards price stability is ensured," the ECB should start cutting rates, but insisted they should not go as low as zero or into negative territory.
According to the latest ECB minutes, the central bank is still undecided on whether it will raise interest rates again at its September meeting.