Piero Cipollone inflation comments showed that he sees price risks as distant from the ECB’s adverse and severe scenarios.
ECB Executive Board member Piero Cipollone said monetary policy should stay well calibrated. He said policymakers are still reviewing incoming economic data. He also said inflation remains far from the adverse and severe scenarios cited by the ECB.
Cipollone said there are no signs of stagflation at present. He added that the risk of economic stagnation with a sharp rise in inflation remains rather remote. Meanwhile, he said ongoing geopolitical uncertainty has not changed that view.
Piero Cipollone Inflation Outlook
His remarks pointed to a measured view on the inflation path. He did not signal concern about a renewed inflation shock. Instead, he said the risk of a stagflationary environment remains low.
Cipollone repeated that policy needs to remain well calibrated. Therefore, his comments kept the focus on how officials assess new data. He also stressed again that current conditions do not point to stagflation.
The source article said recent ECB commentary has turned less hawkish in the past couple of weeks. However, it also said the market is still pricing 40 basis points of tightening by year-end. In addition, it said markets see a 96% probability of a hike in September.
You can access our other news on Forex markets and global market developments here.
Source: InvestingLive
