Global Central Bank Observation ｜ Vicious inflation becomes "the last straw". The European Central Bank is about to sacrifice the most interest rates in history?

21st Century Business Herald reporter Wu Bin Shanghai report

With the greater pressure of inflation, the European Central Bank has a probability that it will sacrifice the most interest rates in history.

The preliminary statistics released by the European Union Statistical Bureau on August 31 showed that the energy and food prices of the euro zone under the Russian -Ukraine conflict continued to soar, and the inflation rate soared 9.1%year -on -year in August, which once again exceeded expectations to reach a record high.

At present, the currency market is expected to increase the total interest rates of 125 basis points by the European Central Bank from October, which means that the next two policy meetings will raise 50 basis points at a time, and the 75 base points will be raised at a time. Based on the concept of "interest rate hikes" more and more deeply rooted, the 75 base points raised interest rates in September were several concentrations.

As the European Central Bank has increased the probability of 75 basis points next week, the euro has returned to the parity. However, Wang Youxin, a senior researcher at the Bank of China Research Institute, analyzed the 21st Century Business Herald that with the expectations of a sharp interest rate hike in the euro zone, the degree of differentiation of European and American monetary policies has narrowed, and the euro has rebounded recently. However, considering that the economic fundamentals of the euro zone are weaker than the United States, the economic crisis may come first. Therefore, from this perspective, the euro rebound is expected to continue, and there is still a recovery pressure after a short -term rebound.

Oliver Rakau, deputy director of the Oxford Economic Research Institute, told a reporter from the 21st Century Business Herald that risks have significantly shifted towards the European Central Bank's more lagging pigeon policy and a more advanced interest rate hike intervention. The European Central Bank is expected to increase its efforts to tighten the monetary policy. In September, 75 basis points raised interest rates and 50 basis points in October. Subsequently, in December and February of February, 25 basis points were raised. After that, the European Central Bank is expected to turn to pigeons, economic recession will promote the slowdown of core inflation, and the labor market will weaken.

Double -digit inflation "close at hand"

According to data from the EU Statistical Bureau, the euro zone reconciled in August and CPI rose from 8.9%in July to 9.1%, higher than the expected increase of 9%, and far exceeded the 2%inflation target of the European Central Bank. At hand.

Specifically, the energy prices of the euro zone in August rose by 38.3%year -on -year, which is the main cause of the inflation of the month. In addition, the prices of food and tobacco and alcohol rose 10.6%, the prices of non -energy industrial products rose 5.0%, and service prices rose 3.8%.

In Wang Youxin's opinion, the continuous rise of the euro zone's inflation mainly reflects the current tension of energy in the euro zone. Affected by the "Beixi-1" since the end of August, the price of natural gas in the euro zone in August has risen rapidly. Note. The price of natural gas continues to continue to drive the euro area inflation. Affected by this, the European Central Bank's tolerance for inflation has declined, and it is increasingly concerned about the dangers of inflation. After the 50 basis points in July, they have begun to consider further tightening. The possibility of 75 basis points at the meeting.

To make matters worse, the core adjustment of the price of energy, food, and tobacco and alcohol is 4.3%, and it has continued to create a record high. The continuous rise in the core inflation rate highlights the spread of the wider economic field. Economists predict that the inflation rate of the euro zone has not yet touched. As the price and electricity price of natural gas soared, the inflation rate in the euro area will rise further in the next few months, which may reach double digits.

Among the major EU economies, the inflation rate of France in August was 6.5%, the lowest euro area, 8.8%in Germany, 9.0%in Italy, and 10.3%in Spain. Estonia ranks first with an amazing increase of 25.2%, followed by Lithuania (21.1%) and Latvia (20.8%).

The European Economic train Germany is not optimistic. Data released by the German Federal Statistics Bureau on August 30 showed that due to the high inflation of energy prices, the initial value of CPI in Germany in August rose 8.8%year -on -year, a record high of nearly 50 years. High Point. The Bank of Germany expects that inflation data in Germany will reach about 10%in the fourth quarter, and it is believed that the prospects are uncertain, and the commodity market is "unknown."

At the same time, the European economic situation is not optimistic. Although the confidence of consumers, retail and construction has improved, due to the decline of optimism in the industry and service industry, the economic confidence in the euro zone has decreased greater than expected. The monthly economic boom index of the European Executive Committee fell from 98.9 to 97.6 after July. In addition, the final value of the consumer confidence index in the euro zone in August was -24.9, a new 19 months.

Wang Youxin analyzed reporters that the risk of economic recession in the euro zone is increasing, and many economies and economic areas have become increasingly sluggish. The largest economy in the euro zone Germany has a high degree of dependence on natural gas imports and affected by the shortage of energy. The industrial production index has continued to grow negatively for many months, and economic growth has gradually fallen into stagnation. At present, at the balance of the central bank's policy formulation, the concerns about inflation gradually exceeded concerns about the slowdown in economic growth. Under the influence of continued to raise great interest rates, it is expected that the euro zone consumption and investment growth will slow down. The euro zone may be before Falling into a recession.

"The last straw"

Faced with the high inflation that has not been seen for decades, the European Central Bank has announced that the three key interest rates have raised 50 basis points last month, of which the interest rate of the deposit mechanism was adjusted to 0%, and the era of negative interest rates was announced.

As the inflation data exploded again in August, the European Central Bank's tightening intensity is expected to be further upgraded. The 75 -basis points of interest rate hikes have been concluded, and the interest rate hike at a single 75 base point will also become the most interest rate hike in the history of the European Central Bank. Now Goldman Sachs, Bank of America, and JPMorgan Chase have stated that it is expected that the European Central Bank will raise interest rate hikes 75 basis points next week. Goldman Sachs pointed out that the inflation data of the euro zone in August is higher than expected, and it will become the "last straw" of the European Central Bank's 75 basis points in the European Central Bank in September. Goldman Sachs also increases the prediction of interest rate peaks. It is expected that the interest rate will rise to 1.75%by February 2023, and the previous predicted peak value is 1.50%.

At present, there are still some voices of the European Central Bank. For example, the European Central Bank Management Commission and Greek President of Greece, Jannis Stournaras, said that the European Central Bank needs to adopt a gradual way to achieve normal interest rates to avoid the risk of having to go back. Essence If the interest rate is raised to a higher level, and then it has to reduce interest rates, this will be a misleading.

But overall, the forces of the eagle are getting bigger and bigger. The European Central Bank Management Commission and the Governor of the German Bank of Germany Joachim Nagel said we should not postpone the next interest rate measures because of worrying about the potential economic recession. Ahead of interest rate hikes can even minimize the risk of "painful" economic recession.

"The longer the inflation is maintained at a high level, the higher the risk of inflation dynamics and mid -term inflation." Nagel warned: "In order to avoid inflation expectations, the euro system should ensure that its determination to fight inflation is unquestionable. "".

In addition, Klaas Knot, the Central Bank Management Commission and the Governor of the Netherlands, also called on monetary policy to be "rapid". KNot believes that the European Central Bank should continue to raise interest rates quickly because in the foreseeable future, inflation in the euro zone may remain high.

Capital Economics高级欧洲经济学家Jack Allen-Reynolds评论称，8月份整体通胀和核心通胀进一步上升，而且存在继续上升的可能性，这将增加欧洲央行加大紧缩力度的压力，天平正转向下周加75 basis points.

For the future, Rakau predicts to reporters that if Russia completely cuts off natural gas supply, it may promote the European Central Bank to turn to pigeons earlier. The high energy prices, the drag on consumer income, the slowdown in global demand, and the increase in uncertainty of industrial activities may increase the risk of recession. However, if the inflation pressure does not show signs of obvious relief, the pain points of the European Central Bank may still be quite high.

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