Don’t Panic About Inflation, France’s Le Maire Tells Europe

(Bloomberg) --

Surging European inflation will be transitory and there’s limited risk of contagion from the even higher rates seen in the U.S., French Finance Minister Bruno Le Maire said.

Speaking on Thursday after a meeting with OECD Secretary General Mathias Cormann, Le Maire said price pressures will eventually dissipate as they’re mainly being driven by energy costs. He also underlined differences between fiscal and monetary policies in Europe and the U.S.

“There’s no automatic transmission of the very strong increase inflation in the U.S. to price levels in Europe,” Le Maire said. “Let’s keep cool heads on inflation.”

The French minister’s call for calm contrasts with caution in other quarters as inflation rates remain higher for longer than initially expected.

Christian Lindner, the pro-business leader pushing to become Germany’s next finance minister, has said Germany’s political class underestimates the dangers of inflation. He’s warned that the European Central Bank must resist the temptation to help out highly-indebted euro-area countries as inflation accelerates.

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