© Reuters. FILE PHOTO: Isabel Schnabel, member of the German advisory board of financial specialists attends the twenty ninth Frankfurt European Banking Congress (EBC) on the Old Opera home in Frankfurt, Germany November 22, 2019. REUTERS/Ralph Orlowski/File Photo
FRANKFURT (Reuters) – Euro zone inflation will stay larger for longer and the European Central Bank must be ready to rein it in if worth progress proves to be more sturdy than policymakers now anticipate, ECB board member Isabel Schnabel stated 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 stated.
“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 stated.
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