Blame ECB for Slovakia's high inflation rate?

Slovakia has the second highest inflation rate within the EU, which is partly the result of the European Central Bank's "extreme policy", thinks Saxo Bank analyst John Hardy, who has recently visited Slovakia. "If we look into the past, ten years ago you could buy significantly more goods in Slovakia than, for instance, in France. However, in the wake of high inflation the prices have quickly swelled almost to match those of Western Europe. Slovakia is one of the countries, where zero or negative ECB rates are unquestionably detrimental. Furthermore, at a time when the rate of indebtedness is rising to all-time highs, the ECB policy poses a great risk," claimed the analyst. According to Hardy, all it takes to see this is a walk through the streets of Bratislava. Renovations and construction works are in progress on every street corner, and apartment prices as well as rentals have ratcheted up into astronomical sums. This poses a significant risk for Slovakia, particularly in light of the fact that most of those who are buying apartments are speculators, seeking to make investments, not to buy their own new homes. A similar situation prevailed in Spain in the past, where the real estate bubble burst on the heels of the financial crisis. Although Hardy believes that the situation in Slovakia has not yet reached these proportions, it is following the same trajectory nonetheless. The analyst emphasises that Slovakia should invest more into infrastructure, digital networks and digitisation per se. In September, the year-on-year inflation rate measured by harmonised consumer prices index stood at 3 percent in Slovakia, topped only by Romania (3.5 percent) among all EU countries.