- but they do see a long period of low inflation
Talking earlier this morning on Deutschlandfunk radio
At the moment we see no heightened or acute danger of deflation, in the sense that consumers would change their behaviour and postpone making purchases because they expect prices to fall which would create a negative spiral causing more deflation
What we do see is a long period of very low inflation. When we have such low inflation then the risk is greater, that should the European economy suffer an unforeseen external shock again, we have no buffer
When asked about interest rates staying low until 2016 he said
If everything else stays as it is today then that could be the model. We as a central bank will try to fulfill our aim as quickly as possible, which is to bring inflation back towards the level of close to but below 2%.
But this will take time because currency policy takes a while to work through the different economic structures
Reuters reporting/translating and I’m just wondering whether “currency” should read “current” given that the ECB have repeated many times that they have no currency target/policy per se
