The ECB and the July curse

The ECB is preparing to increase its policy rate in July. Without this hike and others further down the line, prices and wages could derail on a lasting basis, so affirm the “hawks” for whom the inflation shock is an excellent pretext to exit the low-rate and QE policies that they have always rejected as harmful. More surprisingly, the centrist members of the Council of governors have declined to contradict them. But the risks are all too evident: choking off the supply of credit...