ECB board member Fabio Panetta said that against the background of the fact that inflation in the eurozone remains high and the situation with coronavirus remains tense, the ECB should continue to control borrowing costs.
It is expected that during the December meeting, the ECB will announce the completion of its PEPP program - the size of which is 1.85 trillion euros - after March 2022.
Panetta said that in order to achieve the 2% inflation target, the ECB should continue to support the bond market.
"Firstly, there are signs that the pandemic has not yet ended, as evidenced by the increase in the number of infections and new restrictions. Secondly, a sharp and unexpected reduction in asset purchases can be regarded by the market as a tightening of monetary policy," Panetta said.
According to Panetta, the significant increase in consumer prices in October - by 4.1% per annum - was due to temporary factors and disruptions in the global supply chain, which should not lead to overheating of the economy.
"We should not exacerbate the risk of supply shocks morphing into a demand shock and threatening the recovery by prematurely tightening monetary policy," he said.
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