Interest rate hikes will become increasingly likely if the inflation picture does not change fundamentally, Bundesbank President Joachim Nagel said in an interview with Germany’s “Handelsblatt” newspaper, pointing to the rising inflation rates in the euro area. Nagel used the interview to talk about current prices, the role of monetary policy and the digital euro.

This year’s “Banking supervision in dialogue” symposium centred around the competitiveness of Germany’s banking sector, the way forward for banking regulation, and the impact of technological and geopolitical trends. Hosted by Corinna Egerer and Philipp Otto, this industry event in Frankfurt am Main brought together around 800 representatives from the supervisory and banking communities.

Inflation this year is going to be noticeably higher than we were expecting it to be before the war in the Middle East broke out, Bundesbank President Joachim Nagel told the RedaktionsNetzwerk Deutschland (RND) media network in an interview. How high inflation turns out to be mainly depended on how long the Strait of Hormuz remained blocked, he added. If the outlook doesn’t improve noticeably, I would expect us to raise interest rates in June, Nagel said, pointing to the geopolitical situation and rising energy prices.

The Banking Directive Implementation and Bureaucracy Relief Act (BRUBEG) transposes the extensive amendments to the Capital Requirements Directive (CRD VI) into German national law. That means Germany meets the requirements of the EU banking package. The aim was to introduce the new requirements with as little bureaucracy as possible, in a proportional manner and without lowering prudential standards. An article in the Bundesbank’s latest Monthly Report explains the main changes.