Central Banks
Recession Fears Shouldn’t Delay Rate Hikes, ECB’s Nagel Says
- Some policy makers are worried about the economic fallout
- Debate over size of ECB rate move next week is intensifying
Joachim Nagel
Photographer: Alex Kraus/BloombergThis article is for subscribers only.
European Central Bank Governing Council member Joachim Nagel said concerns over an economic contraction in the euro area shouldn’t derail increases in borrowing costs to counter record inflation.
“We shouldn’t delay the next interest-rate steps for fear of a potential recession,” Nagel, who heads Germany’s Bundesbank, said Tuesday in a speech. Empirical data showed that a so-called front-loading of hikes even minimizes the risk of a “painful” economic downturn, he said.