FRANKFURT (Reuters) – Euro zone inflation will remain higher for longer and the European Central Bank must be ready to rein it in if price growth proves to be more durable than policymakers now anticipate, ECB board member Isabel Schnabel said on Wednesday.
“This means avoiding the mistake of a premature tightening of monetary policy in response to a temporary and possibly short-lived inflation spike,” Schnabel said.
“On the other hand, it means keeping a watchful eye on the upside risks to inflation that financial markets currently anticipate and retain optionality to be able to act if needed,” she said.
(Reporting by Balazs Koranyi; Editing by Francesco Canepa)
