The inflation rate, which temporarily had been negative, has recovered to around 0 percent. That being said, given that the effects of the debt problem remain, the risk of prolongation of low inflation leading to a postponement of investment and consumption has receded but seems to still exist, and I have been monitoring these developments closely.
While we are still expecting positive growth rates throughout our projection horizon, in the coming months we will have to navigate this challenging combination of shocks which is reducing growth and pushing up inflation. The ECB’s recent monetary policy decisions The Governing Council has a steadfast and unwavering commitment to its medium-term inflation target of 2%.