At its monetary policy meeting on 14 December 2017, the Governing Council concluded that an ample degree of monetary accommodation is still needed to secure a return of inflation towards levels that are below, but close to, 2%.
The information that has become available since the previous monetary policy meeting in late October, including the new Eurosystem staff projections, indicates a strong pace of economic expansion and a significant improvement in the growth outlook. The Governing Council assessed that the strong cyclical momentum and the significant reduction of economic slack give grounds for greater confidence that inflation will converge towards its aim. At the same time, domestic price pressures remain muted overall and have yet to show convincing signs of a sustained upward trend. The Governing Council therefore concluded that an ample degree of monetary stimulus remains necessary for underlying inflation pressures to continue to build up and support headline inflation developments over the medium term. This continued monetary support is provided by the additional net asset purchases that the Governing Council decided on at the October monetary policy meeting, by the sizeable stock of acquired assets and the forthcoming reinvestments, and by the forward guidance on interest rates.
