According to Wieland, the economic recovery is still intact and should also pick up considerably in Germany after the winter months. In view of rising inflation rates, the European Central Bank (ECB) should end the pandemic emergency purchase program, Wieland argued. "It has now decided to do so at the end of March. However, it intends to ramp up the "normal" bond-buying program until the end of the year, so that purchases will only decline step by step". He critized that the ECB has virtually ruled out a key interest rate hike or the abolition of the negative deposit rate for 2022. In his opinion, that's a mistake. "In order for the inflation trend to normalize at 2 percent in the medium term, I think the central bank would have to clearly signal that it is returning the key interest rate to a neutral level to match." At present, we do not know from the ECB where this should be and when it will go back there, Wieland said
Regarding the EU debt rules, for Wieland binding rules are important. He is against changing the Maastricht Treaty and increasing the permissible debt ratio from 60 percent to 100 percent. According to Wieland, that would only lead to lower-debt countries also running up their debts.
In his opinion, the German government should only agree to a less ambitious, longer-lasting stabilization of debt ratios within the EU rules if the highly indebted states concerned take concrete measures and demonstrably reduce their debt ratios again. "Softening the rules would be neither in Germany's interest nor in the interest of a stable monetary union in the long term."
An abridged version of this interview has been published by:
Passauer Neue Presse: "Leitzins nicht zu erhöhen ist ein Fehler" (€)