Germany's Laschet says trusts ECB to keep inflation in check

FRANKFURT (Reuters) – Armin Laschet, the conservative candidate bidding to succeed German Chancellor Angela Merkel in this month’s election, said he was confident the European Central Bank (ECB) would achieve price stability, as accelerating inflation hits savers.

“For me, it’s alarming when small savings, pensions, life insurances and building loan contracts lose value,” Laschet was quoted as telling the weekly Welt am Sonntag newspaper.

“I’m sure the ECB will particularly fulfil its core task of monetary stability … But this also means that when interest rates rise again the debt burden becomes an even bigger problem for the state,” he said in Saturday’s edition.

Laschet’s remarks a week ahead of the Sept. 26 general election stand in contrast to comments made by his key expert for fiscal and economic policies Friedrich Merz, who this week lashed out at the ECB’s loose monetary policy.

The ECB this month said it would trim emergency bond purchases over the coming quarter, marking a first small step towards unwinding the emergency aid that has propped up the euro zone economy during the coronavirus pandemic.

This year, the ECB expects inflation of 2.2%, above its 2% target, before falling to 1.7% in 2022 and 1.5% in 2023.

The latest German election poll, provided by Ipsos, puts the conservative CDU/CSU bloc at 21% and the Social Democrats (SPD) at 27%.

Source: Read Full Article