I am still of the opinion that monetary policymakers should look through the energy pricedriven inflation fluctuations since they are of a temporary nature and are in any case strengthening the economy owing to an increase in purchasing power. In Germany alone, the decline in oil prices this year has saved consumers and enterprises something like € billion. That’s almost 1% of GDP.
Unlike the monetary policy debate back in January, the economic recovery in the euro area has now stabilised. The concerns about deflation, which had been overblown even at the start of the year, have now dissipated further.