The ECB strategy: The 2021 review and its future

Lucrezia Reichlin, Klaus Adam, Warwick J. McKibbin, Michael McMahon, Ricardo Reis, Giovanni Ricco, Beatrice Weder di Mauro 01 September 2021



The ECB recently completed an eighteen-month strategy review, published in July 2021, with the aim of innovating on both the design and the magnitude of its policy responses. This report, authored by senior European economists and written in parallel to the official review, provides a timely and clear framework to assess the current changes to and future evolution of the ECB’s strategy.

The report provides a structured discussion of four important topics which were part of the ECB’s analysis in the run up to its 2021 strategy review: the definition of the target (price stability and secondary objectives); the operational framework; fiscal-monetary policy interactions; and the implications for monetary policy of climate change and related mitigation initiatives.

The overall consensus is that the ECB is moving in a sensible direction, but many questions remain unanswered and it remains to be seen whether the new monetary policy strategy will successfully accommodate the challenges it has set out to meet. This report provides an excellent analytical accompaniment that will help frame the discussion going forward.

Professor of Economics, London Business School; CEPR Research Fellow and trustee; IFRS Foundation trustee (chair steering committee sustainability reporting); Fellow of the British Academy; Fellow of the Econometric Society

Professor of Economics, University of Mannheim

Distinguished Professor of Public Policy and Director, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, Australian National University

Professor of Economics and Fellow at St Hugh's College, University of Oxford; CEPR Research Fellow

A.W. Phillips Professor of Economics, LSE and CEPR Research Fellow

Professor of Economics, Warwick University; Chercheur Associé, OFCE-SciencesPo; Research Affiliate, CEPR

Professor of International Economics, Graduate Institute of Geneva; Distinguished Fellow, INSEAD Emerging Markets Institute, Singapore; President, CEPR


CEPR Policy Research