Primacy of Monetary Policy
Expectations are high that inflation will increase in the years to come, given the huge expansion of monetary supply by central banks in order to revive capital markets and stimulate investments, in combination with distrust in the ability of central banks to neutralize this additional money when the economy does pick up again. In particular in Germany where people are compared to other nations price stability hawks since the introduction of the Deutsche Mark. The German public demands that inflation must be kept under control, thereby reducing the ECB’s and the finance minister’s room to manoeuvre.