Economy•12 Aug ’23 10:16Author: Julian Verbeek
According to economics professor Sweder van Wijnbergen, the European Central Bank (ECB) has wrongly become more cautious in its approach to inflation. Although interest rates in Europe have been raised, they are still two basis points below core inflation, ‘while interest rates in the United States are equal to real inflation’. BNR lists the most important economic news of this week for you, so that you are fully informed.
The accommodative policy of the ECB will maintain this inflation, believes Van Wijnbergen. Although interest rates have been raised, they are still two basis points below core inflation. While the interest rate in the United States is equal to that real inflation.’
In that sense, the ECB is making a ‘genuine fallacy’, says Van Wijnbergen. “They have the idea that inflation is something that some kind of God does: ‘it just happens, just like the weather’. There’s nothing you can do about that. They forget that they themselves contribute to it.’
‘The stimulus packages that they do take have so far not been very effective.’ (AP / Associated Press)
China is sinking
On the other hand, according to BNR’s house economist Han de Jong, things don’t look good in China. The expected economic upswing after the strict corona lockdowns failed to materialise. Beijing tries to give the economy a boost with all its might, but De Jong sees it in vain. ‘The stimulus packages that they do take up to now have not had much effect.’
There is now even talk of deflation in the Eastern superpower. “This scenario was already threatening, but it is now a new blow to the economy,” says China correspondent Anouk Eigenraam. This announcement follows poor import-export data, a falling Purchasing Managers Index and lackluster economic data from last month. “This is not good news.”
2023-08-12 08:16:07
#ECB #fallacy #China #deeper #trouble
