By David Barwick – VIENNA (Econostream) – The European Central Bank firmly intends to maintain price stability but is operating under uncertainty regarding the effect on developments of the region’s last inflation episode, Austrian central bank Governor Martin Kocher said Thursday.

“Of course the ECB is determined” to fulfil its price stability mission, Kocher said in a fireside chat with IMF Managing Director Kristalina Georgieva at an OeNB-SUERF conference in Vienna.

“The uncertainty at the moment is creating pressure,” however, he said. “We don’t know exactly how the memory of the last [high inflation] episode” will affect economic agents’ reactions to newly high inflation.

“Hopefully this conflict is not continued,” he added.

Georgieva endorsed the increase last week of ECB interest rates. “We believe that was the right decision to take, because inflation has already gone up,” she said.

As to whether more will be necessary, “that remains to be seen,” she said. It is essential that people understand that “should that action be necessary, the ECB will take it,” she said.