Investing.com -- Olli Rehn, the Finnish central bank chief, has cautioned the European Central Bank (ECB) against becoming complacent about inflation. He emphasized the importance of vigilance in managing risks, including the risk of price growth falling significantly below the ECB’s target.
Rehn noted that with inflation expected to remain below 2% in the coming year, it’s crucial for the ECB to avoid a slide towards the zero lower bound. This term refers to a situation where interest rates are reduced to the lowest possible level to prevent a severe undershooting of the inflation target.
During a press conference, Rehn stressed the need to keep inflation expectations firmly anchored around the ECB’s target. His comments underline the importance of active and vigilant monetary policy management in maintaining economic stability in the European region.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.