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In the USA, the central bank is lowering key interest rates to stimulate the economy

Prof. Dr. Steffen Sebastian (Copyright: IREBS)

In the USA, the central bank is lowering key interest rates to stimulate the economy. This fuels discussions about whether the Fed is still acting independently or has already been manipulated by Trump. Meanwhile, the ECB is sticking to its course of interest rate stability – and that’s a good thing. Premature monetary policy easing in Europe would send the wrong signal in view of the inflation risks that have still not been fully averted. Even if the economy in the eurozone could easily cope with an interest rate cut, a softening of the monetary policy line would be dangerous at the moment. In the long term, the stability of the financial system and thus also the real estate industry will benefit from this discipline.

Prof. Dr. Steffen Sebastian
Chair of Real Estate Finance, IREBS Institute for Real Estate Economics, University of Regensburg

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