“The main driver of inflation is normally wages. We see that the evolution of wages in most countries is not what it usually is in a recovery, which is that they rise very strongly,” Mersch said. Investors expect the ECB to reduce asset buys from next year as growth is robust and the threat of inflation is gone. But policy is expected to remain easy for years to come as inflation will not return to the bank’s target before the decade ends.
ECB has seen very little price pressure in recovery – Mersch
- Monday, Sep 11 2017
The European Central Bank has seen very little pressure on inflation despite an economic recovery and policymakers will discuss this autumn whether to curb stimulus, ECB Executive Board member Yves Mersch said on Monday. Mersch, considered a policy hawk, told Luxembourg radio station 100.7 in an interview that there were a number of reasons inflation was not rising, principal among them the relative lack of wage pressure.