ECB Shifts Strategy Amid Easing Inflation and Future Risks

The European Central Bank (ECB) plans to shift away from its crisis-era strategy of relying heavily on short-term economic data to guide interest rate decisions, as inflation in the Eurozone has significantly decreased. ECB Chief Economist Philip Lane indicated that future monetary policy should focus on upcoming risks rather than past data, once inflation aligns with the ECB's 2% target. This transition is expected to occur over the next year, with the ECB potentially adjusting its approach at its December policy meeting. The move aims to maintain inflation at a sustainable level while considering new economic shocks.