Bank of Greece Governor targets 2% inflation goal

Bank of Greece Governor Yannis Stournaras has identified the primary goal of the Eurosystem as maintaining inflation at 2%. He noted that Greek inflation, which stood at 3.8% in August compared to 3.2% in the Eurozone, is driven largely by high demand resulting from strong tourism flows.

Stournaras attributed broader inflationary pressures to both supply-side factors, such as the energy crisis and geopolitical conflicts in the Middle East and Ukraine, and demand-side factors, including global fiscal expansion and significant investments in artificial intelligence.

Regarding monetary policy, the Governor emphasized that while high interest rates impact borrowing, controlling inflation is essential to protect economically vulnerable citizens from uncontrolled price increases. He also highlighted the importance of fiscal responsibility and the benefits of Greece's investment grade rating in reducing borrowing costs. Other priorities mentioned include judicial reforms, strengthening private savings through professional funds, and investing in renewable energy networks.