In its history of just a little over two decades, the ECB has never encountered the kind of raging inflation that is now tearing into the economies of the member states. And people are getting very frustrated.
But inflation rates vary widely by country. In Germany, the inflation rate is 8.5%. In seven countries, the inflation rate is between 10% and 13%: the Netherlands, Belgium, Greece, Spain, Cyprus, Slovenia, and Slovakia. And in three countries, the inflation rate is over 20%: Estonia, Latvia, Lithuania. This is some serious-ass inflation.
The ECB is ridiculously far behind the curve with €8.75 trillion in assets still on the balance sheet, and declining way too slowly, and with interest rates at 0%, while inflation is 8.9%. At this point, the ECB is still throwing lots of very volatile monetary fuel on the raging inflation fire. It’s still an inflation arsonist, and not an inflation fighter. But it is making the first tentative steps in the right direction, though loo slowly, too little, and way too late.QT Kicks Off at the ECB: Assets Fell by €91 Billion from Peak | Wolf Street