It is now clear that the European Central Bank views higher interest rates as the right response to rising oil prices. As a result, the ECB risks painting itself into a corner, for the logic behind this week’s interest-rate hike implies that more increases will follow – a series of policy mistakes that will cost the Eurozone economies heavily.
It is now clear that the European Central Bank views higher interest rates as the right response to rising oil prices. As a result, the ECB risks painting itself into a corner, for the logic behind this week’s interest-rate hike implies that more increases will follow – a series of policy mistakes that will cost the Eurozone economies heavily.