The European Central Bank’s asymmetric monetary policy approach, followed for several years, has now become a source of instability – the opposite of what its mandate decrees. At any sign of economic weakening, the ECB tends to lower interest rates aggressively. But when inflationary pressures rise, it sticks to a ‘wait and see’ policy, arguing that rising prices are temporary and inflation will soon return to the 2% norm. After announcement of the 7.5% inflation rate in March, the highest since the euro began, this policy of vacillation has run its course and must now end. The right time for a strong message to ... (full story)