In Germany, inflation rose to 4.5 percent in October.
(Photo: dpa)
Frankfurt Deutsche Bank boss Christian Sewing has called on monetary policy to act in the face of soaring inflation. The central banks assumed that the current rise in inflation was a temporary effect, Sewing said on Monday at Euro Finance Week in Frankfurt.
“Our economists do not share this opinion.” Customers of Deutsche Bank prepared themselves for the fact that the high rates will last longer. “I think that monetary policy has to counteract this – sooner rather than later.”
The consequences of the ultra-loose monetary policy would become more and more difficult to cure the longer the central banks do not take countermeasures, Sewing said. Inflation in the euro area rose more sharply in October than it had been in over 13 years. Driven by a sharp rise in energy costs, consumer prices rose by 4.1 percent over the year. In Germany, annual inflation rose by 4.5 percent in October.
So far, however, the European Central Bank (ECB) has anticipated that the current surge in inflation in the euro area will not become a permanent problem. The monetary authorities assume that the current material shortages will ease and that energy prices will fall or stabilize. The ECB is aiming for two percent inflation as the ideal value in the medium term.
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