The European Central Bank will need to make its move quickly if it will be able to stave off inflation in many of Europe's struggling economies. According to Mario Draghi who is a council member of the ECB, "The central bank has the duty to act quickly and firmly" against inflation, as reported by Bloomberg News.
Early this month, Jean Claude Trichet who is president of the ECB said that the bank would work to strive pre-emptively to avoid the wage price spiral.
There are many factors contributing to the increasing inflation including increased energy prices and food price increases. The average household will have significantly less to spend throughout the year should measures not be taken to combat these features.
Draghi did make mention that the European economy was weakening, he made the point of keeping prices in line instead over allowing inflation to creep up later. This will help to underpin employment here and increase consumer spending, key factors that many believe are necessary improve the situation.
While Draghi warned of inflation, several other council members from the ECB implied that it was less important to worry about inflation and more important to consider other facts, including Guy Quaden, who wants to ensure that medium term price stability is the focus.
