New report! The ECB and inequality: can monetary policy lean without falling?

Can the European Central Bank address economic inequality without overstepping its legal mandate? In our last report “ The ECB and inequality: can monetary policy lean without falling?” written by Elia Cerrato García, we explore how income and wealth disparities act as macroeconomic frictions that weaken the transmission of monetary policy. Taking inequality into account is not a political choice, but a legal and operational necessity under the ECB’s current framework. 

Far from being a mere social indicator, structural inequality in income and wealth can compromise the ECB’s primary objective of price stability.

Through the analysis of EU constitutional law and the jurisprudence of the Court of Justice of the European Union, the report demonstrates that the ECB possesses both the legal authority and the institutional obligation to account for these distributional asymmetries. The report offers a clear legal defense of an "inequality-aware" central banking framework and outlines an actionable policy roadmap starting from 2026.

Download the report to explore our analysis!