ECB's Schnabel: Monetary policy can't resolve structural issues

European Central Bank (ECB) Executive Board member Isabel Schnabel hit wires on Monday, cautioning that while lowering rates is the goal, the ECB still needs to be ready to respond to any shocks that could threaten inflation expectations.

Key highlights

We should proceed with caution and remain data-dependent.

Price stability is within reach.

Lowering policy rates gradually towards a neutral level is the most appropriate course of action.

Monetary policy should focus on responding forcefully to shocks that have the capacity to destabilise inflation expectations.

Gradual removal of policy restriction remains appropriate.

Over the next twelve months an economic expansion is still much more probable than a recession.

Monetary policy can't resolve structural issues.

Risks to inflation outlook broadly balanced.

Interest rates are approaching neutral levels.

Confidence is growing that we are on track to hit 2% goal.

The Euro's fall is putting upward pressure on import prices.