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Bloomberg
ECB Governing Council member Klaas Knot said conventional wisdom about inflation is outdated.
The European Central Bank has to investigate “thoroughly†which factors nowadays determine output prices, rather than double down on its stimulus measures, the Dutch central bank president said in an interview with De Volkskrant.
While wages are rising, the costs for business “are not translating into higher output prices because firms apparently set their prices in a different manner than in the past,†Knot told the
newspaper.
Knot’s message echoes comments by Estonia’s Madis Muller, who said last week that the ECB should begin its strategy review by looking into the causes of low inflation before tweaking its target.