6 Jan 2016
ECB's Praet: No Plan B for reaching 2% inflation
FXStreet (Bali) - ECB's Praet, in an interview with the Belgian Knack, notes that there is no Plan B for reaching 2% inflation other than keep easing, adding that "the ECB stands ready to take all measures that are necessary to bring inflation to 2%."
Praet adds: "If you print enough money, you will always get inflation. Always. But if oil and commodities prices tumble, it is more difficult to allow inflation to rise. If a whole series of such factors occur, you can't do anything other than somewhat postpone the date on which you seek to reach the higher rate of inflation."
"The emergence of bubbles is a justified concern. But if the ECB were not pursuing its current policy, the financial concerns would be even more serious because the economy would be in poorer shape", Praet said.
Praet adds: "If you print enough money, you will always get inflation. Always. But if oil and commodities prices tumble, it is more difficult to allow inflation to rise. If a whole series of such factors occur, you can't do anything other than somewhat postpone the date on which you seek to reach the higher rate of inflation."
"The emergence of bubbles is a justified concern. But if the ECB were not pursuing its current policy, the financial concerns would be even more serious because the economy would be in poorer shape", Praet said.