The minutes of the July monetary policy meeting European Central Bank (ECB) revealed on Thursday that officials emphasized the need to review forward-looking guidance on interest rates.
This meeting was the first after the strategic review. The minutes indicated that “the reformulated guidance was better understood as a set of conditions that would help guide the actions of the ECB in pursuit of its inflation target.
According to the minutes, it was noted at the meeting that the forward-looking guidance on interest rates, if credible, “they should reduce the extent to which other instruments have to be deployed.“
The minutes reflect support for Lane’s arguments on the revised version of the forward-looking guidance proposal. “Members agreed with Mr. Lane that incoming information had broadly confirmed the joint assessment of financing conditions and inflation outlook carried out at the June monetary policy meeting,” the minutes read. .
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