In face of new challenges, ECB launches year-long strategy review
By Alexander Bueso
Date: Thursday 23 Jan 2020
(Sharecast News) - The European Central Bank kicked-off a comprehensive one year-long review of its goals, strategy and policies in light of the structural changes that the euro and global economies had undergone since 1998 and the multiple and in many cases new challenges that it was facing.
In a short statement published on Thursday, the monetary authority said that it would review the exact definition of what was meant by its mandate of "price stability", the toolkit it had at its disposal, the processes in place for analysing the economy and its policies as well as its communications policies.
A decline in trend growth and the aftermath of the financial crisis meant that interest rates had been driven towards zero, limiting its ability to use convential policy to respond in future, the ECB said.
"The threat to environmental sustainability, rapid digitalisation, globalisation and evolving financial structures have further transformed the environment in which monetary policy operates, including the dynamics of inflation," it added.
Financial stability and employment would also figure prominently in its review.
"The Governing Council will be guided by two principles: thorough analysis and open minds."
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