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  • Barclays analysts write that the ECB's strategy review that kicked off over the weekend will likely lead to the bank adopting a symmetric inflation target around the 2% level over the medium-term.
  • They write that this would be an endorsement of tolerance for inflation overshooting the 2% target and would imply an extended period of easy monetary accommodation.
  • This implies that negative rate policy, QE and TLTROs would all become conventional policy instruments.
  • This view is supported by recent Reuters reports that cited a source as saying there was general consensus among the board that they could tolerate inflation exceeding a new goal of 2%.
  • The review is touted to be complete by the September 9th governing council meeting.