ECB’s Chief Economist Philip Lane voiced his ongoing concerns regarding the elevated inflation levels in the Eurozone during a conference. Despite a drop in inflation in September to its lowest in two years, Lane emphasized the need for continued efforts to steer price increases back towards the 2% target.
Lane stated, “Price increases are still well above 2%, we are not at the inflation target yet and therefore there is still work to be done in terms of bringing inflation down.”
While wage inflation is anticipated to decline, Lane cautioned that this process would be gradual, as “it’s going to take months, it will take time”. Lane’s focus appears to be more on services inflation data. “I think we will be looking at services inflation data for quite a while,” he shared
One key area of focus for the ECB is the unpredictable nature of energy prices. “We don’t expect the current low gas price to be maintained, we do expect to see gas prices go up from where they are now,” he said. “Energy has been such a volatile component, it’s going to be very important to us to keep an eye on energy in the coming months and years.”
