Sat, May 28, 2022 @ 23:22 GMT
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ECB Centeno: Necessary and desirable to normalize monetary policy

ECB Governing Council member Mario Centeno said normalization of monetary policy was “necessary and desirable”. But such normalization must be done gradually. He urged not to “over-react” to inflation rising across Europe or risk penalizing economic growth.

“Although inflation remains high in 2022, there are no structural reasons why it should not converge towards the medium-term objective as imbalances are gradually resolved and uncertainty dissipated,” Centeno said. “There are currently no structuring signs of de-anchoring inflation,” even though the balance of risks around inflation is skewed upward” after Russia’s invasion of Ukraine.

Second-order effects of wage pressures was “an additional risk which needs close and continued monitoring”, he added.

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