When “Whatever It Takes” Turns Hawkish

This year marks the 10th anniversary of Mario Draghi’s famous speech credited with turning the tide on the European sovereign debt crisis. “Whatever it takes” has since become shorthand among central bank watchers for aggressive action. It aptly described the Federal Reserve’s (Fed) actions to keep liquidity flowing in the financial system in March 2020 and what it had been doing since to support the economic recovery from the pandemic. However, the last six months have seen one of the most spectacular pivots in central bank rhetoric in recent memory. That prior sense of urgency and commitment to supporting the economy is now being applied to the task of getting inflation back under control.