Volker Wieland: "War and energy crisis were only accelerants of inflation"

The weaknesses of the German economy and the current challenges are the subject of an article in "Forschung Frankfurt", the science magazine of Goethe University. Prof. Volker Wieland, who had already warned of significantly rising inflation rates a year before the war in Ukraine, comments on high inflation, pointing out that war and the energy crisis were only the accelerant to 10 percent inflation in 2022.

"According to Wieland, the foundation for inflation was laid during the coronavirus crisis - primarily through government aid packages and cheap money as a result of the ECB's zero interest rate policy and asset purchase programs. In addition, shifts in consumption and production led to supply bottlenecks in a number of industries. And a shortage of supply is driving up prices. In Wieland's view, the ECB should have reacted earlier to the rising inflation by raising key interest rates."

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