“Price pressures should remain temporary”. This is what the governor of Bank of Italy Ignazio Visco said in an interview with Bloomberg.
Visco spoke at the weekend at the ‘Marcello De Cecco 2021 Economics Days’ talking about the pandemic, inflation and monetary policy.
The governor assured that the ECB “will maintain accommodative monetary policy as long as necessary”.
“The changes induced by the pandemic, technological progress and ecological transition can have effects not only on economic activity, but also on the configuration of relative prices and, at least temporarily, on inflation rates”, explained Visco, continuing:
“The central bank should act cautiously in countering shocks that appear to be only temporary in nature. The delays with which monetary policy unfolds its effects, through transmission to credit and aggregate demand, are in fact such that its impact on economy could materialize when the shock has already subsided “.