ECB tightening wouldn't push down energy prices - Schnabel

BY Reuters | ECONOMIC | 01/14/22 01:28 PM EST

BERLIN, Jan 14 (Reuters) - Raising interest rates in the euro zone would not push down soaring energy prices, European Central Bank board member Isabel Schnabel said in remarks published on Friday, adding that any tightening of monetary policy would have an impact much later.

"We must not raise interest rates too early," Sueddeutsche Zeitung quoted Schnabel as saying in an interview. "This could result in stalling the economic recovery."

"If we take action today, it will only have an impact with a lag," she added. "Monetary policy cannot push down oil and gas prices." (Reporting by Joseph Nasr; Editing by Christoph Steitz)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

fir_news_article