2023-11-21 18:35:51
The President of the European Central Bank Christine Lagarde warned on Tuesday that it was “not yet time to declare victory” despite the fall in inflation in the euro zone and the pause in rate increases led by the institution.
“It is not yet time to declare victory (…),” she said during a conference in Berlin.
“We can act once more if we see that there are increasing risks of not achieving our inflation objective,” warned the president of the institution who thus seems not to exclude a new turn of the monetary screw if necessary .
“We are in a phase (…) that I would characterize as being vigilant and concentrated,” she added, recognizing however that inflation had “considerably decreased” in the euro zone.
The European Central Bank kept its main interest rates at their level during its last monetary policy meeting in October, following ten consecutive increases to combat inflation in the euro zone.
This pause came as price increases slowed sharply in the zone, to 2.9% in October, close to the medium-term objective of 2% targeted by the institution.
The leader once once more signaled that rate cuts were not to be expected soon.
The ECB’s key interest rates were raised to their historic high – the main one on deposits is now at 4% – between July 2022 and September 2023, to combat record inflation in the euro zone in the in the wake of the Russian war in Ukraine and the post-Covid-19 recovery.
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