FRANKFURT – Pierre Wunsch (Belgian central bank chief) said in a magazine interview that the European Central Bank might raise interest rates by zero to counter high inflation. He is now part of a group of policymakers openly discussing a rate increase.

While the ECB has maintained rates in negative territory for most of 2014 and not raised them in over a decade, inflation continues to make an increase in the minus 0.5% interest rate more relevant.

Knack, a Belgian magazine, stated that “Based on current outlook”, they will increase interest rates to zero by the end. For me, it’s an easy decision.

He said, “But I must say that within the ECB there have been no discussions about raising interest rates.”

Despite the fact that inflation reached a new record high of 7.5% due to rising oil prices, some policymakers believe the underlying trends remain weak. This could mean that price growth may slip below the ECB’s 2% goal over the medium-term.

Wunsch disagreed and argued that the target has been reached even farther out than expected. Therefore, the ECB should reintroduce extraordinary stimuli.

He said rates might eventually reach 1.5% to 2% and not the 1% that markets had anticipated.

The Austrian, Dutch, and German central bank governors have all argued for a rate rise in the last week. It is possible that a meeting about such a move could soon occur.

Wunsch stated that Belgium may experience recession if Russia loses access to its gas supplies, however that this was still a small price to pay given the current economic environment.

He stated, “That’s okay when I look at the situation in Ukraine.” A temporary recession, even though it is happening temporarily, doesn’t really compare to what has happened in Ukraine with its thousands of dead.