ECB’s Vasle: Closely Monitoring Evolution of Medium-Term Inflation Risks

29 October 2021

By David Barwick – FRANKFURT (Econostream) – The European Central Bank is closely monitoring the evolution of medium-term inflation risks, ECB Governing Council member Boštjan Vasle said Friday.

In a statement issued in his name by the Bank of Slovenia, which he heads, Vasle said that ‘the strong economic recovery continues, but is moderating somewhat amid supply-side constraints hampering the performance of manufacturing and some service industries.’ Growth is being driven primarily by private demand, he said.

Inflation, ‘driven by rising energy prices, a strong recovery in demand against a backdrop of supply-side constraints and base effects’, would initially continue strengthening before starting to moderate over the course of 2022, he said.

‘We would also like to stress that we are closely monitoring the evolution of risks to sustained higher inflation in the medium term’, he said, describing the risks as ‘mainly related to rising inflation expectations and upward wage pressures in some segments of the labour market.’