The ECB is confronted with a harsh reality: businesses are profiting from inflation.
Signage is seen outside the European Central Bank (ECB) building, in Frankfurt, Germany, July 21, 2022. FRANKFURT, 2 MARCH - Last week, huddled in a retreat in a remote Arctic village, European Central Bank policymakers faced some cold hard facts: companies profit from high inflation, while workers and consumers pay the price. Over the last nine months, the dominant macroeconomic narrative has been that sharp price increases in everything from energy to food to computer chips were driving up costs for businesses in the eurozone's 20 member countries. To cool demand, the European Central Bank (ECB) raised interest rates by the most in four decades, arguing that higher consumer prices would push up wages and create an inflation spiral. However, three sources who attended the retreat in the Finnish village of Inari, intended to give the bank's Governing Council a chance to delve into themes only touched upon at regular meetings, said a slightly different picture emerged. Accordin