The European Central Bank said today that the euro's rise in the past could weigh on inflation in many quarters to come, but this could be prevented by the growing pricing power of firms.
The European Central Bank has been stimulating the economy over the past years to revive inflation, but the euro's rise over the past year, which has partially fallen in recent weeks, has supported calls for tighten monetary policy to avoid chocking off growth and inflation.
The euro rose more than 4% against the US dollar compared to last year but has fallen by 7% since the beginning of 2018.
