ECB’s Herodotou says forex rate not targeted, but inflation impact is

ATHENS (Reuters) – The European Central Bank does not target exchange rates but does take into account the effect they have on inflation, Cypriot policymaker Constantinos Herodotou said on Thursday.

“We don’t target the exchange rate as a matter of policy. What we do take into account is the effect (of) the exchange rate into inflation,” Herodotou told a conference in Athens.

“The big majority of the inflation increase is primarily energy related, but not so much exchange rate related.”

Herodotou also said inflationary expectations had not deanchored.

(Reporting by Balazs Koranyi; Writing by Michele Kambas; Editing by Peter Graff)