(Bloomberg) -- The European Central Bank will do “whatever it takes” to stop an inflationary overshoot becoming permanent, Governing Council member Yannis Stournaras said, invoking the crisis-fighting words of former President Mario Draghi.
The vocabulary, echoing the Italian's historic speech a decade ago in the midst of the region's debt turmoil, highlights the stakes ahead of a meeting next week that is taking place against the backdrop of record consumer-price readings.
“We'll do whatever it takes -- and I'll stop here as we're in a silent period -- not to let temporary inflation becoming structural and permanent,” Stournaras, the Bank of Greece governor who is normally seen as a dovish official, said at the Delphi Economic Forum.
His reference to a quiet period reflects the practice of policy makers avoiding public comment before an interest-rate decision. The ECB Governing Council is due to meet on Thursday and discuss its current plans to wind down stimulus at a time when inflation is at 7.5%, the fastest in the euro's history.
There are “a series of supply side shocks, the pandemic could not be foreseen, the war could not be foreseen,” Stournaras said. “It's creating very high spot inflation. We could kill it if we wanted to in a month,” but it would also kill the economy, he added.
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