The ECB held two days of what appeared to be a useful conference to debate some ideas - though without agreeing on a course of action. The highlight was Paul Krugman's endorsement of a higher inflation target. This is what Krugman had to say:

The intense resistance of central bankers to regime change even after more than five years at the zero lower bound shows that the kind of policy stasis that afflicted Japan for almost two decades is a more or less universal phenomenon...And let's be blunt, there are already visible tendencies toward a similar loss of resolve in Europe, for example declarations by monetary officials that low inflation isn't really a problem because it's mainly driven by needed adjustments in debtor nations.

In the discussion of Krugman's paper Guido Tabellini said he agreed with Krugman that the inflation targeting regime needed to be reconsidered. As alternatives he also suggested a price level target, or a nominal income target.

From Bloomberg we hear that Otmar Issing said the central bank would lose credibility if it shifted the inflation target. And James Bullard of the St Louis Fed agreed. He said the job of the central bank is to actually hit the target, not shift the target once you have missed it.

Reuters reports that Mario Draghi was especially sceptical.

What would it mean for a German, for example, to have a 5% objective in the whole of the euro area... I don't even want to think [about] that.