The people of Europe suffer from inflation.

Currency devaluation is by no means only an issue in Germany, but also in France, for example, where Marine Le Pen discovered the loss of purchasing power as an important issue for her election campaign.

In recent months, suspicions have been heard in Germany that the European Central Bank is delaying interest rate hikes in order to help Emmanuel Macron in the election campaign.

This would be an odd calculus.

In fact, inflation is helping Le Pen.

Currency devaluation acts like an additional tax that hits the poor in particular.

Debasement is, and this has long been in the textbooks, very anti-social.

It is therefore necessary to take timely and consistent action against inflation.

Unfortunately, the ECB has not yet given the impression of recognizing the urgency of this issue.

Instead, she looks for excuses to postpone necessary decisions into an uncertain future.

difficult environment

This puts the ECB in an increasingly difficult position.

Your assumption of an average inflation rate of 5.1 percent for the current year underestimates the dynamics of currency devaluation, which will continue to be primarily driven by rising energy and food prices.

On the other hand, under the plausible assumption that the war in the east will not end quickly, the assumption of economic growth of 3.7 percent this year is likely to prove to be overly optimistic.

It is a well-known fact that high inflation when the economy is slowing creates a very difficult environment for monetary policy.

As expected, the ECB continues to shy away from making clear statements about its actions;

instead, she prefers to wait for new data from the economy.

After grossly underestimating inflation for a long time, the ECB is still reacting too slowly.

The bond purchases must be stopped as quickly as possible and the negative deposit rate increased to at least zero so that the age of negative interest rates ends for bank customers too.

A negative interest rate with a current inflation rate of a good 7 percent can only be described as grotesque.

Security of monetary value

The ECB's dilemma is the bond purchases, not the increase in a short-term key interest rate, which is only to follow afterwards.

Because what happens if, after the end of the central bank's bond purchases, there are no private buyers for government bonds from highly indebted countries at low yields?

Voices in the ECB then consider the outbreak of a new euro crisis to be unlikely, but not all members of the central bank council believe this.

As a result, the ECB is working internally on a program that, rather than general bond purchases, could help individual countries if bond yield differentials became worrying.

Whether this program will see the light of day is uncertain because, depending on how it is structured, it could end up before the Federal Constitutional Court.

The ECB should refrain from these plans;

the support of distressed euro member countries is not their task.

Their mandate is to safeguard the value of money.