Joachim Nagel, a recently appointed president of Bundesbank and a new member of the European Central Bank's (ECB) Governing Council, said on Tuesday that the medium-term outlook for Eurozone's inflation is “exceptionally uncertain”.
He noted that the elevated price pressures are only partly due to temporary factors, adding that, in his view, there is now a greater risk that inflation rates could remain heightened for longer than currently seen.
"In any case, monetary policy must be on guard,” he stressed. According to Nagel, the Governing Council must take action and adjust the course of its policy, if price stability warrants it.