ECB’s Stournaras says an appropriate monetary policy response in Eurozone will depend on the size and nature of the energy shock
- Says there are downside risks to Eurozone economy growth forecasts, which reflects structural vulnerability to energy disruptions
Context
Stournaras's comments highlight the ECB's conditional approach to monetary policy in response to potential energy shocks, emphasizing downside risks to growth in the Eurozone. This suggests that future rate decisions may be more data-dependent, particularly regarding energy prices, which could lead to increased volatility in the EUR and impact fixed income markets if investors recalibrate expectations based on inflation or growth forecasts.
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