Economics and politics - comment and analysis

The ECB’s interest rate hike is a grandiose mistake

5. February 2023 I Economic Policy, Europe, Forecasts

The ECB’s decision on 2 February to raise interest rates again by 0.5 percentage points and to announce an equally large increase for March will go down in history as a grand misjudgement. Although it is already foreseeable that the price development in Germany and Europe will quickly approach normal values in the course of this year, …

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Germany is in recession – and that is extremely dangerous!

In the past, there were still recessions in the economy. These were phases of shrinking gross domestic product (GDP) that lasted two, three quarters or a whole year. Rising unemployment and shrinking incomes were practically always the result. And monetary policy always had to lower interest rates and the state had to intervene by increasing its own (debt-financed) spending if it wanted to prevent worse, …

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