FRANKFURT (Reuters) - A gradual rise in euro zone inflationary pressures would not necessarily mean that price growth is on a sustained upward path and warrant a further removal of stimulus, European Central Bank chief economist Peter Praet said on Thursday.
“If the flow of incoming data were to confirm the expectation of a gradual build-up of inflationary pressures, this would not necessarily be sufficient to affirm a sustained adjustment, as less supportive monetary policy conditions could imperil the inflation trajectory,” Praet said.
“Once the Governing Council judges that the three criteria for sustained adjustment have been met, net asset purchases will expire, in line with our guidance,” Praet told a conference.
The ECB’s bond buys are due to expire in September and policymakers are debating whether to end the scheme even if inflation is rising only gradually.
Reporting by Balazs Koranyi; Editing by Francesco Canepa