The head of Germany’s central bank warned on Friday that euro zone inflation remained sluggish and the outlook is uncertain, striking a cautious tone as the European Central Bank prepares to decide on the future of its aggressive stimulus programme.
A long-standing critic of the ECB’s massive purchases of sovereign bonds, Jens Weidmann backed the central bank’s decision on Thursday to keep policy on hold and put off any move until October.
“The forecasts published yesterday show that the increase in inflation is sluggish and the uncertainty about the future inflation path is quite large,” Weidmann, who sits on the ECB’s Governing Council, told an audience in Hamburg, Germany.
“For this reason, the Governing Council has decided to wait and take its time to assess the monetary policy situation,” he added.
Source: Reuters (Reporting By Francesco Canepa; Editing by Balazs Koranyi)