Schnabel Says Rising Yields Could Temper Inflation Pressures

European Central Bank (ECB) Governing Council member Isabel Schnabel suggests that the recent surge in global yields could have a cooling effect on inflation pressures.

In an interview, Schnabel stated that when the economy is resilient, high costs are passed through to consumers more quickly, but the current yield spike may alter this dynamic and reduce price pressures.

Schnabel believes that this response from the economy could lead to a gradual return of inflation to target levels, assuming expectations remain anchored.