Rehn Sees No Second-Round Inflation Effects in Euro Zone

European Central Bank policymaker Olli Rehn spoke in London about the current state of inflation and monetary policy in the euro zone. He noted that no clear signs of second-round inflation effects have emerged, despite recent shocks to the economy. The ECB continues to monitor labour market conditions closely, as well as other data.

Rehn emphasized that the bank maintains a toolbox of 'viable instruments' to ensure smooth transmission of monetary policy. He also expressed support for using jointly-issued debt to strengthen the region's defence capabilities.

The policymaker addressed regulatory matters, stating that Europe can reduce red tape in banking and finance while maintaining sturdy capital buffers remain critical. He noted that the European Union is paving the way on ethical guidelines for artificial intelligence, but the U.S. and China are far ahead, creating a need for international cooperation.