In a recent article from Yahoo Finance, Peter Kazimir, a member of the European Central Bank (ECB) Governing Council, expressed his opposition to the revival of any 'special tools of monetary policy.' Kazimir believes that the world has changed significantly after the COVID-19 pandemic and amid the geopolitical crisis, including the war in Ukraine. He argues that these factors provide clear reasons against the return to any special monetary policy tools. Kazimir also acknowledged that the past decade of loose monetary policy has had both benefits and costs, and he expects the 'new normal' to be different. However, he declined to comment further on monetary policy as the ECB is currently in a quiet period ahead of its upcoming rate decision [2f487f79].
This perspective adds to the ongoing discussion about the challenges faced by the ECB in addressing the potential return of inflation and the potential European recession. Kazimir's opposition to the use of special monetary policy tools suggests a preference for a more conservative approach. It highlights the dilemma faced by the ECB in finding the right balance between monetary conservatism and monetary expansion to address inflationary pressures while supporting economic recovery. The article emphasizes the need for the ECB to carefully navigate these challenges to maintain price stability and effectively address the potential European recession [c039d6b9].
Sources: Yahoo Finance [2f487f79], The European Conservative [c039d6b9]