HELSINKI (MNI) – The European Central Bank is in a situation of
high uncertainty that requires it to take its monetary policy decisions
“step by step,” Governing Council member Michael Bonello said Friday.
Speaking to journalists on the margins of the anniversary
conference of the Bank of Finland, Bonello said, “Our reading of the
situation yesterday was that we didn’t need to take any further steps
yesterday. As you know, the situation is surrounded by a lot of
uncertainty, so one has to take decisions step by step. So we have to
wait for next month; we’ll have our projections, we’ll have more
information.”
It’s not a question of being” less worried about inflation, he
said. “Trying to predict things that far into the future in these
uncertain times I think would be foolhardy. So I think it’s just a
matter of taking it month by month.”
Bonello said he had “no idea” as to when the ECB would next enter a
mode of “strong vigilance,” noting that he would be leaving his position
as Central Bank of Malta governor and thus his spot on the Governing
Council at the end of June. “We will see what the data tell us next
month. Then after that I will be an ECB watcher, like you.”
Asked whether the ECB had turned “softer on inflation” based on
yesterday’s monthly press conference, he replied, “I don’t know how you
would define that. But I think it’s very clear, we’ve been very clear in
defining how we take our decisions and explaining.”
Bonello two weeks ago said that the ECB had to be careful that its
policy decisions did not hurt the fiscally troubled countries of the
Eurozone too much, thus distancing himself from other Council members,
who have asserted that this is not a factor in monetary authorities’
efforts to keep inflation expectations anchored.
–Frankfurt bureau tel.: +49-69-720142. Email: dbarwick@marketnews.com
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