Wolfgang Munchau thinks Eurozone interest rates should be raised to avert inflation. He’s probably right, but it will mean *a lot* of pain in Spain.

Inflation in Spain is already too high, but the dependence on construction and housing is also too high. Wherever rates go, either people will lose purchasing power on a major scale (they already are), or the most important sector in the economy will suffer a sharp correction.

The weird thing is that Spaniards will just have to watch this unfold because the decision regarding rates isn’t theirs, but the ECB’s.

Link: Raise eurozone rates now or risk inflation

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