ECB's Stournaras Warns Strait of Hormuz Closure Could Lift Wages, Prices; Inflation Overshoot May Prompt More Restrictive Policy
ECB policymaker Stournaras warned that a closure of the Strait of Hormuz could have secondary effects on wages and on the prices of goods and services, potentially adding to inflation pressure.
He said inflation must return to the ECB's medium-term 2% target and that a significant overshoot should be met with a balanced, careful adjustment of monetary policy in a more restrictive direction.
From the sources (6 posts)
@financialjuiceECB's Stournaras: The closure of the Strait of Hormuz may have a secondary effect on wages and prices of goods and services
@firstsquawkThe ECB’s Stournaras cautioned that a potential closure of the Strait of Hormuz could indirectly affect wages and prices across goods and services.
@firstsquawkThe ECB’s Stournaras emphasized that inflation must be brought back in line with the 2% target over the medium term.
@financialjuiceECB's Stournaras: It's necessary to ensure the return of inflation to the medium-term target of 2%
@financialjuiceECB's Stournaras: If inflation rises significantly above target, there should be a balanced, careful adjustment of the monetary policy towards a more restrictive direction
@firstsquawkAccording to ECB’s Stournaras, a significant inflation overshoot should prompt a careful, measured move toward a more restrictive monetary policy stance.