economy contracted for the first time since the launch of the euro

The ECB issued its monthly bulletin today and said “it will continue to fight inflation even after the economy contracted for the first time since the launch of the euro a decade ago,” according to Bloomberg. “’Growth figures for mid-2008 will be substantially weaker than for the first quarter of the year… against this background and in full accordance with our mandate, the Governing Council emphasizes that maintaining price stability in the medium term is the ECB's primary objective and that it is its strong determination’ to keep inflation expectations anchored.”

Rate cut?

Not likely.

The region getting stagflation is not the US—it’s Europe.

Bye for now

Barbara Rockefeller

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