The near-term increase in Eurozone inflation was largely driven by temporary factors that would fade in the medium term and not call for policy tightening, policymakers of the European Central Bank said at the September governing council meeting held in Frankfurt.
According to the account of the monetary policy meeting, released Thursday, members agreed that accommodative monetary policy stance remained necessary to offset the negative impact of the pandemic on inflation and to re-anchor of inflation expectations solidly around the new target.
Further, members said that risks to the economic outlook remained broadly balanced.
The council noted that the economic outlook could deteriorate if the pandemic worsened, which could delay the further reopening of the economy, or if supply shortages turned out to be more persistent than currently expected.
At the September meeting, the bank had slowed the pace of its emergency asset purchases programme and left its key rates unchanged.