ECB at risk of missing its 2% inflation target

The risk has increased that the European Central Bank won’t get inflation back up to where it wants, the bank’s chief economist said yesterday, pledging to beef up its anti-deflation asset-buying programme if necessary.

Peter Praet, who is also a member of the ECB’s executive board, told reporters on the sidelines of a conference in Germany that falling commodity prices and a slowdown in China are hindering the goal of getting inflation back up to around 2%.

It is currently at 0.2%, a trend that has prompted the ECB to start buying €60bn worth of assets a month, mainly sovereign bonds, to combat deflation.