What the ECB’s Strategy Review Must Do
The European Central Bank’s new strategy review must recognize that economists are still a long way from understanding the dynamics of low inflation. Given this uncertainty, the ECB should aim to adopt robust policies that cause the least damage under a broad range of scenarios.
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LONDON – With her recent announcement of the European Central Bank’s long-overdue strategy review, new ECB President Christine Lagarde has generated high expectations. The review’s outcome will be the first important signal of how Lagarde intends to lead the institution – and of how the ECB is likely to address persistently low inflation in the eurozone.