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Inflation Wins As ECB Pivots Hawkish Despite ‘Watershed’ War
Boxed in by the highest inflation on record and the (assumed) impossibility of pivoting aggressively
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This is anecdotal but from what I am hearing- German automobile makers are shutting down assembly lines a few days/week due to parts which are normally assembled in Ukraine, not being available.
Car prices won’t be dropping anytime soon.
I have heard a similar story from one of my sources as well, although he added that in most cases car manufacturers have diversified the sourcing, so this is only very temporary.
I’m interested in the correlation with Japan, actually, the potential post pandemic mindset. The Hawks have essentially courted the concept that airborne coronavirus was fake news and that economies needed to be fully open. The exaggerated panic to get everything back to normal in a V recovery remains their wet dream fantasy. Ignoring weak recovery data and smoothing over all the nonlinear abnormal distortions of the last three years doesn’t add to stability.
It’s interesting to have a counterbalance perspective from Japan:
“such a rise in inflation alone would not be reason to dial back stimulus, Nakagawa said, adding that Japan’s economy was still in the midst of recovering from the pandemic’s wounds.”