ECB policymakers make case for a big rate hike

JACKSON HOLE, Aug 28 (Reuters): European Central Bank (ECB) policymakers made the case on Saturday for a large interest rate hike next month as inflation remains uncomfortably high and the public may be losing trust in the bank's inflation-fighting credentials.
The ECB raised rates by 50 basis points to zero last month and a similar or even bigger move is now expected on Sept 8, partly on sky-high inflation and partly because the US Federal Reserve is also moving in exceptionally large steps.
Speaking at Fed's annual Jackson Hole Economic Symposium, ECB board member Isabel Schnabel, French Central Bank chief Francois Villeroy de Galhau and Latvian central bank Governor Martins Kazaks all argued for forceful or significant policy action. "Both the likelihood and the cost of current high inflation becoming entrenched in expectations are uncomfortably high," Schnabel said. "In this environment, central banks need to act forcefully."