The strong monetary growth observed over the past few years, means that there is significantly more liquidity available in the euro area than needed to finance non-inflationary growth. Whether the accumulated excess liquidity will translate into inflationary pressures over the medium term depends on the extent to which past portfolio shifts are reversed and on the future strength of economic growth.
Should excess liquidity persist, it could lead to inflationary pressures over the medium and long term. In summary, the economic analysis continues to indicate that the outlook for price developments over the medium term is in line with price stability. Cross-checking with the monetary analysis does not alter this picture.