Dr. Dirk Ehnts:

I would argue that right now it is not that we have inflation which is above the target. The core inflation rate of the eurozone is 2%, which is exactly the target rate. Energy prices have been rising, although in the past few weeks they have been falling. The rebound by the energy prices created deflation last year and now it is creating above-average inflation. If the oil price stops rising right now and the price per barrel of oil is somewhere between $80 and $90 and if it is stable there for the next year, the problem of inflation, if you see it as a problem, will be gone. Then we will be back to the old problem that we do not have enough inflation, that the ECB cannot hit its inflation target. We should have a conversation in the eurozone about public wages. If public wages are rising by less then 2% in most eurozone countries, how is it possible to have prices rising by more than 2% or 2% even? It seems to be impossible. We cannot have wages growing at 1% and then expect prices to grow at 2%. That kind of political system is unsustainable. Workers would lose and voters would be upset with a system like that. If the ECB wants to hit its inflation target we need to have higher rates of wage growth.