- If bond purchases end in Q3 as expected, rates could rise this year
- The ECB should rise if the outlook calls for it
- The low inflation environment is unlikely to return
- The risk of second-round effects from high inflation is on the rise
Nagel is the head of the Bundesbank and a hawk, so these comments come as no surprise. If ever the ECB found itself behind the curve in an inflationary environment, it would absolutely destroy the budgetary balances of the euro zone.