This idea could undermine the very foundations of the monetary union, not least because it could lead to inflation expectations becoming de-anchored. If so, it could fuel further hostility against the ECB in Germany and a rise of the far right in future elections. Whatever the economic merits of this idea, they are detached from political realities. Average inflation targeting is likely to be perceived as abandonment of price stability by the ECB. The ECB has already been under fierce political attack in Germany for its accommodative monetary policy. Although these attacks are not fully justified - QE was very much needed to reduce deflation risk and this was vindicated in the European court - it is still true that it has indirectly helped governments finance fiscal deficits and reduced their borrowing costs, notwithstanding the fact that this was not the purpose of the exercise (they also financed the private sector, which is what saved the ECB case in court). Average inflation targeting, however defined, is too vague. Without specifying a target horizon it’s by definition vague, and is likely to de anchor inflation expectations in the short run. Even if a target horizon is specified, this is likely to be arbitrary and that can reduce central bank credibility, which, once again would de anchor inflation expectations. In fact, this may already be happening in the US - although the jury is still out on that experiment. It would, therefore, be premature and politically irresponsible for the ECB to follow the Fed on this occasion without waiting for evidence that would support such a move. In my honest opinion, such evidence is unlikely to be forthcoming. Very wise of the ECB Governing Council to steer clear of average inflation targeting at this juncture.