ECB’s Nagel Says Central Banks Mustn’t Fall Behind the Curve
- Bundesbank chief warns inaction could result in greater damage
- Sees ‘initial signs’ of above-target inflation expectations
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Acting too slowly in the fight with inflation would risk more economic damage down the line, according to European Central Bank Governing Council member Joachim Nagel.
“Central banks must not respond with too little, too late,” Nagel told an event Thursday organized by the Bundesbank and the Bank of France. “If monetary policy falls behind the curve, even stronger hikes in interest rates could become necessary to get inflation under control. This would create much higher economic costs.”