Consumer prices are rising, money is getting tighter: Christian Sewing is very worried.
Deutsche Bank CEO Christian Sewing has described high inflation as a “poison” for society. If 40 percent of people say in surveys that they can no longer save at the end of the month, that threatens social peace in Germany, Sewing said at a banking conference in Frankfurt.
In addition, the ongoing price pressure increases the risk of a recession. The company’s order books are still full and profits are high, but he’s worried about the next twelve months, said Sewing.
The ongoing corona pandemic, tense supply chains and bottlenecks on the labor market would add to the price explosion. Should there be a gas embargo in the course of the Ukraine war, there will be a “deep recession” in Germany.
In view of the high inflation, higher interest rates from the central banks are “essential,” Sewing said. Only if the central banks took decisive countermeasures could they dampen price developments. He would like the US Federal Reserve to raise interest rates by 0.75 percentage points. He would also like the European Central Bank to “raise interest rates faster than expected”.
In the eurozone, consumer prices rose 8.6 percent year-on-year in June. According to the Federal Statistical Office, in Germany they were 7.6 percent above the level of the same month last year. Calls for further relief for citizens have therefore become louder.