FRANKFURT May 19 The European Central Bank
cannot risk running "the economy hot" to support employment once
inflation stabilises at its target of almost 2 percent, ECB
Executive Board member Benoit Coeure said on Friday.
"Should we reach a point where the path of inflation is
expected to be self-sustaining, but long-term unemployment
remains high, there should be no doubt as to how I would decide
regarding our policy stance," Coeure said in Geneva.
"Monetary policy cannot 'run the economy hot' as insurance
against labour market risks."
He also added that so far there is no evidence that a
prolonged period of high unemployment has increased structural
unemployment in the euro zone.
(Reporting By Francesco Canepa; Editing by Balazs Koranyi)