In a speech in Ljubljana, Slovenia Christine Lagarde He stressed that the increase in the key interest rate will come as soon as the mass bond market (QE) program ends: “The first interest rate increase will take place sometime after the end of the bond purchase program. We have not yet set the exact time. Intentionally. But I want to be clear. There will be a period of only a few weeks “.
For Carsten Bjeski, chief economist of ING Bank, there is no room for misinterpretation. Speaking to DW, he stressed that the key interest rate increase will be announced after the ECB’s board meeting in July.
Immediate action is required
The president of the German Federal Bank agrees with this assessment Joachim Nagel, who said yesterday that high inflation weakens the purchasing power of households and, combined with the uncertainty surrounding the war in Ukraine, leads to a loss of confidence. According to the head of the Bundesbank, immediate action is needed because otherwise rising prices and wages may further strengthen the upward trends in inflation.
The war in Ukraine, as well as the lockdowns in China, have exacerbated supply chain problems, while energy prices are breaking new records. As a result, inflation in the eurozone recently reached 7.5% with the economy remaining stagnant. According to ING Bank chief economist Carsten Bjeski, “we currently have a stagnant economy and high inflation. In other words stagnant inflation. And that’s the biggest challenge for the ECB. ”
DW – Misa Earhard / Stefanos Georgakopoulos
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