- ECB's Governing Council member de Cos: I think yield curve control is option worth exploring - Reuters
Market news
4 January 2021
ECB's Governing Council member de Cos: I think yield curve control is option worth exploring - Reuters
- Experience of central banks suggests that, if sufficiently credible, yield curve control allows central bank to achieve yield curve configuration with lower amount of actual purchases, hence enhancing efficiency
- Implementation of yield curve control would be more complex in Eurozone since ECB would need to target 19 sovereign yield curves
- Alternative ECB could consider is targeting risk-free yield curve, coupling it with flexible use of the ECB’s asset purchase programme; this strategy would probably deliver similar outcomes
- We need inflation to be higher than current number, if only marginally higher, meaning for example 2%
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