ECB Rehn Says High Yields Dampen Price Pressures
European Central Bank policymaker Olli Rehn stated that surging bond yields will help dampen energy price pass-through by slowing economic growth. High yields and rising borrowing costs counter inflationary pressures across the euro zone.
Rapid energy inflation across the euro zone has not spread to other sectors, and rising bond yields will dampen price pressures by slowing growth, European Central Bank policymaker Olli Rehn said Tuesday morning. The remarks come as inflation runs well above the ECB's 2% target, prompting internal debate over further rate hikes. Higher borrowing costs across the bloc are beginning to constrain economic activity and curb the secondary pass-through of energy costs to wages.
