LISBON, Sept 20 Reuters The current levels of the European Central Bank39;s key interest rates are compatible with a reduction in the inflation rate to the 2 target in the medium term as the factors that pushed prices upward are dissipating, ECB policymaker Mario Centeno said.

The ECB raised its main interest rate on Thursday to a record high 4 and signalled its latest hike was likely to be the last as the euro zone39;s economy slows.

In an interview with public broadcaster RTP late on Tuesday, Centeno said that, if current interest rates are maintained, it will be a very significant effort in combating inflation.

ECB rates as they stand today are compatible with 2 inflation in the medium term, Centeno said.

This is the time for us all to be confident that policy has taken its course, inflation is reducing and the factors that justified the increase in inflation are dissipating, he added.

He said inflation was caused by a quite rapid economic recovery after the pandemic and shocks such as the impacts of the war in Ukraine and rising energy prices.

Centeno said that the ECB is not anticipating a new energy shock that could come from rising oil prices, especially because economies today are less dependent on oil than they were a few years ago.

Inflation in the 20 countries sharing the euro was 5.2 yearonyear in August, more than twice the ECB39;s target.

Centeno said that the ECB39;s decisions will be taken at each meeting based on available information.

He also…