European Central Bank policymakers have promised to “steadily” maintain stimulus when they promise to ignore short-term rises in inflation and nominal interest rates, according to the minutes of last month’s meeting. ..
The· account The results of last month’s meeting, when the ECB decided not to change key stimulus measures, strengthened the impression of analysts that the central bank wants to avoid major policy changes most of the year. ..
However, the ECB’s Governing Council said, “A temporary rise in inflation should not be mistaken for a sustained rise, and it is likely that it will only appear slowly.”
The central bank also said: “All increases in nominal yields are not interpreted as unreasonable tightening of funding terms and trigger a corresponding policy response .. .. It was the evolution of real interest rates that was important from a monetary policy perspective. “
Carsten Brzeski, Global Head of Macros for ING, said: “The ECB is determined to do nothing for the rest of the year, but the minutes show rather loosening if changes are needed, rather than policy tightening.”
The ECB has announced that it will launch expansion stimulus measures in December and maintain “favorable funding terms” primarily through a € 1.85 trillion bond purchase program that will continue through March 2022.
“It was argued that monetary policy should be maintained steadily and that the measures taken in December should be given time to be fully implemented,” the minutes said.