DECRYPTION – The war in Ukraine, combined with inflation, which it is exacerbating, is already weighing on consumer and investor confidence.
After saving the eurozone economy during the pandemic thanks to the trillions of “whatever it takes”, the European Central Bank (ECB) appears powerless in the face of the ills of the moment: inflation out of control and the economic slowdown linked to the war in Ukraine. It’s as if she reacted out of time. For too long, it has been reluctant to tackle inflation, considered to be a mere transitory manifestation of hiccups at the end of the crisis. He is now public enemy number one. At 4.5% in France, 7.3% in Germany and 9.8% in Spain in March, this price increase is straining household budgets and constraining businesses. The figure for the euro zone, expected this Friday, should continue to rise after 5.8% in February. The peak is not expected before the summer.
This led the ECB to accelerate the gradual withdrawal of its accommodative policy launched in 2015 to, ironically, reawaken inflation. A first hike in its key rate is expected…
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