ECB's Kocher sees currently no second-round effects from Iran war, but bank is ready to act
- The situation is marked by high uncertainty as the intensity of the conflict keeps changing, the Austrian central bank governor said
BERLIN: The European Central Bank currently sees no second-round effects from the US-Israeli war on Iran, but is paying close attention to indirect price effects from the conflict, ECB policymaker Martin Kocher said in an interview published on Wednesday.
“At the moment we are paying particular attention to the indirect price effects of the war in the Middle East and possible second-round effects. We currently see no second-round effects, but must also align our monetary policy with inflation expectations,” Kocher told German financial newspaper Börsen-Zeitung.
The situation is marked by high uncertainty as the intensity of the conflict keeps changing, the Austrian central bank governor said.
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“Therefore we are ready at any time to deploy monetary policy measures, should that be necessary,” he said.
The euro area is getting through this difficult phase fairly resiliently, though the longer the Iran war lasts, the more difficult it will become, Kocher added.
Medium- and long-term inflation expectations remain well anchored, which is a sign of confidence in the determination of monetary policy, he said.