German business group says European Central Bank interest rate policy threatens euro Reuters

BERLIN (Reuters)-German conservative business group said on Monday that the European Central Bank (ECB) decided to keep interest rates at historically low levels for longer to boost weak inflation, which threatens the currencies of the 19 member states of the Eurozone stability.

The European Central Bank said last month that it will not increase borrowing costs until it sees inflation reaching its 2% target at the midpoint of its forecast range. The current forecast range will be extended to 2023 and one year in December each year.

“Rising inflation is a disturbing warning sign,” said Wolfgang Steiger, secretary-general of the Economic Committee of the CDU, which has 12,000 members. CDU) is closely related.

German consumer prices were coordinated with inflation data from other EU countries. In July, they rose 3.1%, a 13-year high, compared with 2.1% in June, which led to the service trade union Verdi’s request for a substantial increase in wages.

“This shows that in the long run, unlimited borrowing is not a political plan,” Steiger added. “Ordinary savers will ultimately pay the price for the unprecedented expansion of monetary and fiscal policies in the past few years.”

Conservatives in Germany oppose the expansionary monetary policy of the European Central Bank and demand a rate hike.

For most of the past decade, inflation in the Eurozone has been below the ECB’s target, even though interest rates have fallen to historical lows and stimulus measures have been introduced.

“This is a fatal signal that the central banks of the United States and Europe have made new profits by reformulating their interest rate strategies, sticking to zero and negative interest rates for longer periods of time, and enduring higher inflation rates,” Steiger added. road.