• Just like the case of undershooting, we can also tolerate a small inflation overshoot
• I haven’t dramatically changed my view on policy outlook
• We are still in a good place
• We have learnt lessons from 2021/22 but comparisons with the current situation are not entirely valid
• Comfortable holding gold reserves at the Fed, confident in the Fed’s swap lines

The first point is arguably the most notable. If anything, it reaffirms that the central bank won’t be rushing to take steps in addressing the impact from the US-Iran conflict. And I would say rightfully so. As a reminder, it’s still just less than a week since the conflict started.

These days with the social media revolution, the echo chamber runs so quickly that everyone wants a response or an answer almost immediately. It’s the same thing like in football too. Your team might go on a 5-game win streak then lose a game after, then suddenly everyone will start piling in and talk about how the club is in “crisis”. Geez.

All that being said, complacency is a killer. And that is something the ECB needs to be well aware of in trying to play down any major effect from higher energy prices in the region, even if temporary. So, Sleijpen playing down their response to the Russia-Ukraine aftermath isn’t exactly good form. After all, we all can still remember how the whole ‘transitory’ episode went.