It is not up to the European Central Bank to tackle inflation rate fluctuations, Board member Pablo Hernandez de Cos said, according to Bloomberg.
“It is up to fiscal policy” to take care of each country’s specific problems, he said in Frankfurt on Saturday. De Cos said the central bank’s mandate was to “focus solely on inflation in the euro area as a whole”.
The ECB has signaled that its asset markets are likely to close in July. This has led traders to bet on a series of rapidly rising interest rates that could prematurely tighten financial conditions for some of the region’s weakest economies, fueling concerns that fragmentation could return to the 19-nation eurozone.
“As long as we see that there are problems with the transmission of monetary policy, then of course this is also taken into account in monetary policy decisions,” said de Cos, who is the head of Spain’s central bank.
The premium required by investors to hold Italy’s most risky debt against safe German bonds rose to more than two percentage points at the beginning of the month for the first time since May 2020. More recently, in September, it was less than one percentage point. .
Source: Capital
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