There is no great risk of either deflation or inflation in the euro area, European Central Bank Executive Board member Yves Mersch said Monday.
Following his speech at the Chamber of Commerce in the Luxembourg capital, Mersch, asked about the relative danger of inflation and deflation, said the answer could be found in the introductory statement of ECB President Mario Draghi.
There, he said, it was made clear that there is no very high risk of either inflation or deflation in the medium term.
Indeed, he noted, in releasing its latest assessment today “the European Commission … also said there is nowhere a danger of deflation which is considered a major danger.”
“So from that point of view, I think this is more to be found in” media reports than “in economic analyses,” he added.
However, he continued, there is a risk of “too long time or protracted low inflation, but this is different from deflation.”