- The European Central Bank remains unwilling to cease its monthly purchase of securities and to raise interest rates in its domain.
- Inflation in Europe has not been this high for a long time and investors are getting nervous about the monetary stance of the ECB and its president Christine Lagarde.
- Meanwhile, as discussions have heated up on this subject, yields on government bonds in the European zone have jumped up in a major way.
- The major fear is that if the ECB holds off fighting inflation that it will have to over-react at a later time and this will not be good for financial markets or economies.
- But, for now, we wait, as Ms. Lagarde and the ECB seem to be falling behind the inflation curve.
For further details see:
European Central Bank: Falling Behind The Inflation Curve