ECB’s Cipollone: We can and should reduce the level of monetary policy restriction

• The pace and extent of reduction will depend on data
• Developments remain consistent with a consumption-led recovery
• Whether the recovery will firm up remains to be confirmed
• We should not be more restrictive than what is necessary to ensure timely convergence of inflation to target
• It could be self-defeating to tolerate an economy running persistently below potential as an insurance against possible future inflationary shocks

This article was written by Adam Button at www.forexlive.com.