ECB WATCH | ECB Strategy Review: 2% and mindful of climate change
Published on Thursday, July 8, 2021
ECB WATCH | ECB Strategy Review: 2% and mindful of climate change
Summary
The strategy review has been relatively moderate, introducing a symmetric and clearer (2%) inflatio target, and adopting as permanent the current toolkit. The change has been less ambitious than the one by the Fed. On climate change, the ECB is clearly more committed to specific action, but depends on other institutions
Key points
- Key points:
- In its new strategy review, the ECB adopts a symmetric 2% target, as expected. This is a moderate but welcome change
- Interest rates will remain the primary tool, while “non-standard” measures will be part of the monetary policy toolkit, though no details are provided
- The ECB firmly commits to climate change in the conduct of its monetary policy
Geographies
- Geography Tags
- Europe
Topics
- Topic Tags
- Financial Markets
Authors
Sonsoles Castillo
BBVA Research - Chief Economist for Financial and Economic Analysis
Sumedh Deorukhkar
BBVA Research - Senior Economist
Miguel Jiménez
BBVA Research - Lead Economist
María Martínez
BBVA Research - Principal Economist
Cristina Varela
BBVA Research - Principal Economist