By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member Martin Kocher said Tuesday that policymakers were watching closely for second-round effects from the recent energy shock, saying these were what mattered for the medium-term inflation path and stressing that the goal remained to return inflation to 2%.

Kocher, who heads the Oesterreichische Nationalbank, spoke in Vienna as the Austrian central bank presented its March interim outlook.

“It’s important that we’re keeping a very close eye” on second-round effects, Kocher said. “Our goal is to reach 2% inflation in the medium term.”

There was not yet evidence in the data that such effects had begun to emerge he said, but the ECB would not allow a repeat of the inflation seen in 2022.

“However, the outbreak of the war in the Middle East on February 28, 2026, and the subsequent marked rise in energy prices have again caused great uncertainty, significantly clouding the economic outlook,” Kocher said.

The outlook depended on how long the war lasted; policymakers needed to run different scenarios and be prepared, he said.

“The future course of the war in the Middle East and its impact on energy prices, financial markets and the confidence of economic agents are highly uncertain at this point in time,” he said.