Action will have to continue to strike the right balance between the risk of doing too little, leaving inflation high for too long and thus affecting expectations and monetary stability, and of doing too much, leading to a fall in income and employment and undermining financial stability, with repercussions for price dynamics that are no less serious.
Balancing these two risks, the Governing Council decided the day before yesterday to raise its key interest rates by 50 basis points, announcing that it would raise them by the same amount in March and would assess the pace of any further rises at a later date.