The European Central Bank (ECB) can
be expected to pause its policy of raising interest rates to
combat high inflation before the end of the year, Bank of Italy
governor Ignazio Visco said on Thursday.
"Once we have reached the right level" of rates "it must be
maintained for a while, and I do not think we are very far off",
Visco said in an interview to Skygtg24.
The central bank chief, who is also a member of the governing
council and general council of the ECB, said the pause could be
expected "certainly before the end of the year".
Visco also said that decisions on rates are taken on a
case-by-case basis at each meeting.
The ECB's policy of raising interest rates to fight inflation
has drawn strong criticism in Italy, including from Premier
Giorgia Meloni and Deputy Premiers Antonio Tajani and Matteo
Salvini.
However, Visco denied that there is a systemic problem or
problem of financial stability arising from the rise in interest
rates and the consequent increase in payments of variable-rate
mortgages.
"Household debt in Italy is the lowest in Europe," he added.
Adjustable-rate mortgages "only represent a third (of the
total)," said Visco, adding that those taken out since the start
of 2023 are capped.
"There are measures underway that will help those most in need,"
continued the governor, pointing out that borrowers with
variable-rate mortgages "should have perceived that an increase
was possible".
"There needs to be more information and willingness to
understand the risk," he said.
On the proposal to establish a minimum wage in Italy, the Bank
of Italy chief said it should be introduced for workers not
covered by collective employment contracts, refusing however to
"get into the level of remuneration, which should not be too
high but should be established by those responsible".
"In Italy it is said there is already a contractual wage, but
many (workers) are not covered by these contracts," Visco told
Skytg24.
"I believe it is these people" who must have a "reasonable
wage", he added.
Earlier this month opposition parties registered a joint bill in
the Lower House introducing a minimum wage of nine euros gross
per hour "to guarantee adequate earnings for workers, especially
those in conditions of poverty in part because of inflation".
Confindustria has said it would not be against such a move,
adding that it would not affect the industrial association as
its collective contracts are all above the nine-euro mark.
"If we want to talk about a minimum wage with a nine-euro
threshold, it's not a problem for Confindustria," President
Carlo Bonomi told the assembly of the Assolombarda section.
"All our contracts are above that. If we take the metalworkers'
contract, for example, the price is 11 euros.
"It is not true that industry doesn't pay well. It pays what is
right. There is no veto. On the contrary," he said.
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