To increase transparency, Wieland advised publishing surveys and forecasts as well as an interest rate path. In addition, Wieland called to mind the function of government bond purchases as crisis instruments. "They are not intended for normal operations," he said. Referring to the ruling of the German Constitutional Court in May 2020, he called for the proportionality of bond purchases to be included as a central issue in the ECB strategy review currently underway. This would ultimately also strengthen the monetary pillar of the strategy".
Wieland was dismissive of calls for a green monetary policy and warned of a conflict of objectives between monetary policy and climate policy. "The ECB's mandate is to maintain price stability, not to fight climate change." However, he said, the ECB could be a role model.
In the study, the members of the Kronberger Kreis warn against fiscal dominance in monetary policy. The high government debt ratios in the eurozone put the ECB under pressure to keep the cost of debt financing low. This pressure endangered the ECB's independence and should not tempt it to continue its crisis policy beyond the Corona crisis, he said.
Members of the Kronberg Circle are Prof. Lars P. Feld, Eucken Institute (spokesman), Prof. Clemens Fuest, Ifo Institute, Prof. Justus Haucap, University of Düsseldorf, Prof. Heike Schweitzer, Humboldt University of Berlin, Prof. Berthold U. Wigger, Karlsruhe Institute of Technologies.
Kronberger Kreis Study No. 67: "Die geldpolitische Strategie der Europäischen Zentralbank: Was geändert werden sollte und was nicht" (PDF)
Media articles on the Study:
Dow Jones: Kronberger Kreis will von EZB mehr Regelbindung und Verhältnismäßigkeit
Reuters: Kronberger Kreis fordert mehr Verhältnismäßigkeit in der Geldpolitik