ECB Governing Council member Olli Rehn emphasized the importance of maintaining a proactive, balanced policy in the current monetary policy landscape. According to Rehn, the central bank has moved into an area that restricts aggregate demand, and he argued against abandoning this stance prematurely.
Rehn stated, “In monetary policy, we have moved into an area that restricts aggregate demand, and there is no reason for us to abandon it or exit it prematurely.” He added, “The path to sustainable growth is narrow, but it can be traversed with a proactive, balanced policy.”
Rehn further explained that by adhering to this approach, “we can achieve our goals without causing unnecessary costs to the economy – also because now the central banks are independent and not subject to political pressure, as in the 1970s.”
