US rate hikes cause tighter financing conditions in emerging economies, expert says
BERLIN -- Tighter financing conditions as a result of higher US interest rates "is more an issue for emerging economies," an expert at the German Kiel Institute for the World Economy (IfW Kiel) has said.
"The associated depreciation of the euro vis-a-vis the US dollar has an additional inflationary effect in the short term, which is not welcome at the current juncture," Klaus-Jurgen Gern, an expert on business cycles and growth at the IfW Kiel, told Xinhua in a recent written interview.
Inflation in Germany jumped to a new record of 10 percent in September, according to preliminary data from the Federal Statistical Office.
In terms of shaping the German economic outlook, the impact of the US rate hikes was placed "second" by the expert.
"Eroding purchasing power of private households due to high inflation, uncertainty with respect to energy supply in the coming winter and supply chain issues are more important influences," Gern said.
