Lagarde: ECB Took "Balanced Approach"

Q: What were the other options were being discussed by GC members? Even after the war there is no returning to the pre-war normal given that commodity prices are likely to stay higher, the green transition will accelerate and governments will spend more on defence. These will be inflationary. Was this discussed by the GC and was it factored into the projections?

• A: Some members thought that given the uncertainty, we should be uncertain as well and do nothing. Other members thought we should move ahead and not have any conditionalities, despite the uncertainty.
• The proposal that was debated and supported by the executive board was the balanced approach of taking in the staff projections and the medium-term inflation outlook to propose a path that reduces net asset purchases and brings us to concluding the net asset purchases under the condition of data dependence.