Economics
Villeroy Says ECB Should Consider Tweaking Its Inflation Goal
- Officials might need to change definition of price stability
- French governor says ECB has more monetary firepower if needed
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European Central Bank policy maker Francois Villeroy de Galhau signaled that he’s open to letting inflation rise above the institution’s goal and changing the language it has used for nearly two decades to set its objective.
The Bank of France governor said that the current target for price growth of “below, but close to, 2%,” is often incorrectly interpreted as a ceiling that would mechanically trigger tighter policy. Instead, it should be seen as “symmetric,” he said at an online conference on Friday.