FRANKFURT (MktNews) - The tEuropean Central Bank (ECB) should not make any further interest rate cuts his year, Ruediger Pohl, president of the Halle economic research institute said in an interview released Wednesday by Focus Money magazine.
"It is possible that past price increases will lead to higher wages and a price-wage spiral. Given this, I would even recommend the ECB raise rates," Pohl said in an interview for Thursday's edition of the magazine.
According to Pohl, eurozone liquidity is now ample and further rate cuts would be ineffective, just as in the United States.
"Because of this, there will be only one small further rate move this year in the eurozone at the most", Pohl said.
For the second half of this year, Pohl saw no "significant positive impulses" as improvements were to come only slowly.
According to Pohl, the U.S. economy would first have to improve. Until then, eurozone economy would continue to stagnate.
"I do not expect a recession (in the eurozone). For this to happen production would have to decline in many sectors and at this time, this can't be observed anywhere", Pohl said.
Meanwhile, Pohl criticised the German government for not pushing through labor market reforms, as more economic growth could only be achieved with more flexible labor markets.