The ECB is now also dealing with the euro’s falling value against the US dollar. Because the dollar is the preferred currency for global trade, this will increase European import prices for goods at the same time that gas prices are spiking, Greg Fuzesi, a euro area economist for JPMorgan Chase, pointed out in a research note.

The ECB also has farther to go than the Fed to make borrowing more expensive because its target rate is lower than what the Fed’s was when it started tightening. Given the European economy’s mounting challenges, the central bank may have to pick up the pace of its hikes even more in coming months.

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