ECB's Kocher: Europe's Economy Gaining Momentum Despite Inflation Fears

European Central Bank (ECB) Governing Council member Martin Kocher says the continent's economy is gaining momentum, despite ongoing concerns about inflation. Speaking at the Federal Reserve's annual economic symposium in Jackson Hole, Kocher noted that Europe's economy has shown 'some momentum now, more momentum' than previously thought.

Kocher acknowledged that inflation remains a pressing issue, with prices rising 3.3% in August. However, he emphasized that policymakers are being vigilant and not complacent about the situation. The ECB is set to consider further monetary policy action, including another interest rate hike, in September.

The economy has so far weathered the impact of the Middle East conflict, growing by 0.4% in the second quarter. Policymakers are closely monitoring whether the initial spike in energy costs will lead to second-round effects like rising wages, which could exacerbate inflationary pressures.