Log in
E-mail
Password
Show password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

Some in ECB think inflation forecasts too pessimistic -Makhlouf

09/17/2021 | 09:08am EDT
FILE PHOTO: The logo of the European Central Bank (ECB) is pictured outside its headquarters in Frankfurt

DUBLIN (Reuters) -Some European Central Bank policymakers believe that the bank's inflation forecasts, which were raised only last week, are still too pessimistic, Governing Council member Gabriel Makhlouf said on Friday.

However Makhlouf, Ireland's central bank chief, said fears of excessive euro zone inflation are overstated "at the moment" and that notwithstanding the "considerable uncertainty" about the persistence of price pressures, the current pick-up is transitory.

Euro zone inflation has been rising more than expected recently and hit a 10-year high of 3.0% in August, data confirmed on Friday, challenging the ECB's benign view on price growth and commitment to look past what it deems a temporary increase beyond its 2% target.

"Some of us do believe that actually the forecasts are too pessimistic. Some of us do believe that at the moment the forecast of reaching inflation of 1.5% in 2023 is too low," Makhlouf told an online conference.

The ECB, which took a first small step last week towards unwinding its emergency pandemic aid at the same time as updating its forecasts, sees inflation at 2.2% this year, falling to 1.7% next year and 1.5% in 2023.

Makhlouf told the conference a number of times that if policymakers think and see evidence that inflation is going to go above its target, they will respond. "That will absolutely happen," he said.

"There's almost a bit of a sense that central banks are going to sit and watch all this happen. Certainly not at the ECB," he said.

Makhlouf said it would be important the ECB maintains an accommodative monetary policy stance "for some time" to ensure the continued recovery from the COVID-19 pandemic remains solid.

Raising interest rates in response to a temporary rise in prices would be harmful to those efforts, he added.

Makhlouf said that with the correct monetary and fiscal policies in place, a sufficiently strong demand-driven recovery should see inflation return to 2% over the medium-term.

(Reporting by Padraic Halpin; Editing by Jon Boyle, Alex Richardson and Hugh Lawson)

By Padraic Halpin


© Reuters 2021
Latest news "Economy & Forex"
05:55pRogers family boardroom drama unlikely to impact deal to buy Shaw
RE
05:52pLIVESTOCK-CME live cattle falls as cash market idles
RE
05:47pS&P snaps 7-day winning streak amid taper talk
RE
05:41pRoche's implant for chronic eye disorder wins U.S. approval
RE
05:41pSPAC linked to Trump's social media venture surges for second day
RE
05:40pToronto market rises for third week as energy shares rally
RE
05:38pBristol Myers interested in buying Aurinia Pharma - Bloomberg News
RE
05:37pDow posts record closing high, stocks gain for 3rd week; dollar dips
RE
05:35pEuro Gains 0.41% to $1.1647 -- Data Talk
DJ
05:35pThe WSJ Dollar Index Falls 0.37% to 88.05 -- Data Talk
DJ
Latest news "Economy & Forex"