I will argue that failing to arrest high inflation in a timely manner would jeopardise the green transition more fundamentally, and that a restrictive monetary policy stance today will benefit society over the medium to long run by restoring price stability.
I will also stress that fiscal policy needs to remain in the driving seat and accelerate the green transition, and that the decline in the ECB’s balance sheet as part of our monetary policy tightening requires us to make additional efforts to align our actions with the objectives of the Paris Agreement.