FRANKFURT – The sharp increase in global energy prices since the start of the Iran war has revived memories of the 2022 spike, triggered by Russia’s full-scale invasion of Ukraine, and the energy sanctions that followed. At that time, central banks failed to recognize right away the scale of the inflationary pressures being generated. By the time they did, they had little choice but to launch an abrupt and aggressive monetary-tightening cycle. Today, they seem committed not to make the same mistake.

© Project Syndicate