According to Bundesbank boss Joachim Nagel, the European Central Bank does not want to be deterred by the gloomy economic outlook in its fight against inflation. It cannot be ruled out that there will be lower growth rates or a recession, said the ECB council member on Deutschlandfunk. In the end, however, stable prices are much more important “for medium-term, long-term growth”. Nagel assumes that inflation will accelerate further and could peak at more than ten percent in December. For 2023, too, the annual rate of increase will probably be significantly too high at more than six percent, Nagel continued. There are signs that inflation is spreading in many areas. That is why monetary policy must now clearly “take hold”. On Thursday, the ECB raised its key interest rate by 0.75 points, more so than ever before. The background is the rapid increase in consumer prices, driven primarily by the war in Ukraine and the aftermath of the pandemic.
Bundesbank – Inflation likely to remain high – Economy
