The European Central Bank needs to see momentum in services inflation come down this year in order to confirm its disinflation narrative, the ECB’s chief economist said today, adding it will not have much new information by its July meeting.
“It’s fair to say momentum at the start of the year in services was relatively high,” Professor Philip Lane told Reuters.
“So I think this is an example where we need to see the momentum come down in the second half of the year,” he added.
Philip Lane was speaking at a Reuters NEXT Newsmaker interview at the London Stock Exchange today.
He also said that the ongoing turmoil in euro zone bond markets, centred around France, is not disorderly, effectively playing down the need for the ECB to intervene.
“What we are seeing in the markets is a repricing but it is not in the world of disorderly markets right now,” Professor Lane said today.
The ECB has set as a condition for any intervention in bond markets that there is an unwarranted and disorderly move in yields.
Article Source – Services inflation needs to come down this year – ECB’s Lane – RTE
