>> GROUP: Shadow ECB Council / EZB-Schattenrat  Daniele Antonucci

Daniele Antonucci: What could ECB's strategy review look like? I think it's likely to cover two main aspects:

- The definition of price stability, i.e., how the central bank (re)defines it, and what symmetry of the ECB inflation aim means; and
- The central bank reaction function, i.e., how does the ECB react when it's not meeting the inflation objective (as currently).

I'd imagine that, Fed-style, the review will likely lead to evolution, rather than to a complete overhaul of the framework. It'd probably be more about thinking about the overall decision-making process than just discussing potentially different formulations for the inflation target. The idea, we think, is about reinforcing the message that the target/framework implies no downward inflation bias, e.g., a more symmetric 2%Y inflation target with no "but below", and that the central bank will ensure policy accommodation to facilitate inflation convergence.
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