In our July Governing Council meeting, we translated our strategy into a specific expectation of the future direction of our monetary policy. Our forward guidance sets out two conditions for raising policy rates. Medium-term price development relevant for monetary policy First, we emphasise that we will not react to short-term inflation fluctuations.
We want inflation to stabilise at 2% in the medium term in order to durably pave the way out of the low interest rate environment. Despite the current high inflation rates, this condition is not yet fulfilled.