- There are some near-term risks related to omicron
- But it is not a factor that will influence activity levels for the year
- We think that inflation will fall "quite a bit" later this year
- Rather than focus month by month, ECB has clear vision of direction i.e. inflation will fall later this year
- So far, do not see a big response in wages on inflation
- Less likely to see a scenario where inflation is persistent, requiring serious tightening of policy
- Full interview
Well, even if omicron infections hasn't peaked in Europe yet, the economic impact - at least based off the PMI data yesterday - has been less marked than anticipated. So, that's quite a positive takeaway. As for his inflation remarks, only time will tell. They've been wrong about it all the way through since last year, so we'll see.