With inflation risks high, ECB should err on the side of doing too much: Schnabel

FRANKFURT (Reuters) – Euro zone inflation is at risk of overshooting recently lifted forecasts and the European Central Bank should err on the side of raising rates too much rather than too little, ECB board member Isabel Schnabel said on Monday.

“We need to remain highly data-dependent and err on the side of doing too much rather than too little,” Schnabel said in a speech just days after the ECB raised rates for the eighth straight meeting.

“Risks of both a de-anchoring of inflation expectations and weaker monetary policy transmission suggest that there is a limit to how long inflation can stay above our 2% target,” she added.

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