ECB's Praet Sees Signals Of Inflation Converging Towards Target

ECB's Praet.jpg

European Central Bank Executive Board member Peter Praet sees signs of inflation converging towards target.

"Signals showing the convergence of inflation towards our aim have been improving, and both the underlying strength in the euro area economy and the fact that such strength is increasingly affecting wage formation supports our confidence that inflation will reach a level of below, but close to, 2% over the medium term," Praet said at the Congress of Actuaries, in Berlin on Wednesday.

He said any decision concerning the termination or further extension of net purchases will hinge on the ultimate judgement of the Governing Council.

Praet noted that low interest rates fundamentally reflect the consequences of unfavorable secular trends, combined with the fall-out from the global financial crisis and euro area sovereign debt crisis.