9 In my view, the two-pillar approach of the ECB does not only show that there is a special relationship between the choice of a strategy and the need for forecasts. The use of a particular concept for monetary policy also has consequences for the efforts a central bank makes to improve its forecasting abilities.
For the ECB one possible extension might be found in a more strongly formalised combined assessment of the information included in both pillars for future inflation developments at various time horizons. When I point to the fact that different strategies in monetary policy require different forecasting approaches I don’t want to deny that all central banks face a lot of similar forecasting problems.