Technical Analysis

ECB Schnabel:There is risk that monetary & fiscal policies may pull in opposite directions

Greg Michalowski

ECB’s Schnabel is speaking. She says:

  • In the current environment, there is risk that monetary and fiscal policies may pull in opposite directions
  • we continue to stand ready to counter fragmentation in financial markets that is not justified
  • incoming data so far suggest that the room for slowing down the pace of interest rate adjustments remains limited
  • A new macroeconomic environment requires a different mix of monetary fiscal policies
  • we will need to raise interest rates further, probably into restrictive territory
  • the latest risk for central banks remains a policy that is falsely calibrated on the assumption of a fast decline in inflation
  • there is increasing evidence that the pandemic in the energy crisis may have more permanent negative effects on current and future potential output

Not so positive or dovish comments from ECB Schnabel

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