MNI BRIEF: ECB Sets 2% Symmetrical Inflation Target

The European Central Bank will target inflation at 2% symmetrically over the medium term, the Governing Council said Thursday as it released the outcome of its near 18-month strategy review.

The symmetric target will see negative and positive deviations of inflation from the target as equally undesirable. "When the economy is operating close to the lower bound on nominal interest rates, it requires especially forceful or persistent monetary policy action to avoid negative deviations from the inflation target becoming entrenched," a statement accompanying the decision said.

This may also imply a transitory period in which inflation is moderately above target, the ECB added..