The ECB decision to maintain rates “neutral” through a minimal increase of a quarter-point and the announcement that the APP program will end July 1 – but “rollover” continues – has left both doves and hawks unhappy. In Germany, the move is seen as totally inadequate to curb inflation, whereas in Italy, the immediate increase of the spread has raised fears of a new debt crisis.
German headlines on the ECB decision yesterday: “ECB Chief Lagarde Is the Mother of Inflation” (Focus); “Lagarde Undermines Confidence in the Euro” (Die Welt); “Travel in Nowhereland with Lagarde” (Handelsblatt); “The ECB Green Money Policy Torpedoes the Central Bank Mandate” (Wirtschaftswoche); “I Do Not Know What Mrs. Lagarde Is Waiting For” (Peter Bofinger quoted in Capital).
(Wirtshaftswoche's headline is noteworthy. The article scolds the ECB for having prioritized green bond purchases instead of fighting inflation.)
