ECB’s Villeroy: Tracking broader set of variables could help ECB reconcile secondary objectives

“Our inflation objective, being symmetric and medium-term, -– if credibly, I stress credibly, symmetric and medium-term –- would probably achieve similar outcomes ex-post to flexible average inflation targeting,” argued European Central Bank (ECB) Governing Council member François Villeroy de Galhau on Wednesday, as reported by Reuters.

Tracking a broader set of variables, assets of financial institutions and nominal GDP, could help the ECB reconcile its secondary objectives with the primary mandate, Villeroy further added. 

Market reaction

The EUR/USD pair largely ignored these comments and was last seen losing 0.22% on the day at 1.1716.