ECB Schnabel says she doesn’t expect ‘excessively high’ inflation

BERLIN, July 10 (Reuters) – Inflation in the euro area is unlikely to exceed and the current increase in price growth due to the coronavirus pandemic will be temporary, said Isabel Schnabel, a member of the board of directors on Saturday. administration of the European Central Bank.

“I am sure we will not experience excessively high inflation,” Schnabel told the Frankfurter Allgemeine Sonntagszeitung in excerpts from an interview published before the publication.

Schnabel’s comments come a day after the accounts from the ECB’s June monetary policy meeting revealed growing concerns among conservative policymakers that the rise in inflation may be longer than expected.

Commenting on the ECB’s new symmetrical target of 2% inflation, Schnabel said: “On the one hand, the increase in the inflation target is minimal. On the other hand, the 2% target has an important function: it creates an additional margin for our monetary policy to have a stabilizing effect. ”

She added that interest rates would not stay low forever and that it was vital for European governments to ensure that the large amounts of stimulus spending they deployed pave the way for a return to a sustainable growth path.

Schnabel’s comments on growth echoed his remarks a week ago at a conference in Germany.

Reporting by Douglas Busvine; Editing by Toby Chopra

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