ECB rate hike

Three ECB policy makers have now publicly aired a preference for a half-point increase in interest rates.

That’s far beyond the horizon of the April 14 meeting discussion, at least as the president described it at the time. Or should we go beyond the neutral rate?” “We’re getting inflation data for two more months until then,” he said. With that comes the possibility that more policy makers might publicly call for open aggression on inflation at a time when most global counterparts have long taken action. But in Europe we may be going in that direction, so concern is legitimate.” Three policy makers have now publicly aired a half-point move.

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Whatever the case, the debate among ECB officials has now clearly moved on from whether to act and when to do so first, to already wondering aloud where rates are likely to end up. “Everything else risks being seen as soft.” Three policy makers have now publicly aired a half-point move. But in Europe we may be going in that direction, so concern is legitimate.” With that comes the possibility that more policy makers might publicly call for open aggression on inflation at a time when most global counterparts have long taken action. Article content

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Central banks are finding themselves between a rock and a hard place as inflation grows while the consumer slows.

So, there have been some contradicting comments from the ECB, which should be very wary about hiking rates right now. Although they are planning to begin in July. But, from what we are seeing, these hikes are not having any impact on cooling off inflation whatsoever which has only been picking up pace in the last two months. A year ago US CPI (consume price index) inflation moved above 5% and instead of slowing down, it has been accelerating in recent months after the price surge since March. Central banks have pressed the panic button and have started increasing interest rates pretty fast.