The data “confirm the ongoing disinflation process and this process will continue – said ECB President Christine Lagarde speaking to the Economic and Monetary Affairs Committee of the European Chamber -, according to forecasts, taking us even lower in 2024”. On interest rates, “we will continue to follow a data-dependent approach to determining the appropriate level and duration of tightening, taking into account the inflation outlook, underlying inflation dynamics and the strength of monetary policy transmission.”
“Eurozone economic activity was quite weak in 2023 and this weakness characterized all sectors. But leading indicators point to a recovery next year.”
“A year and a half ago we were the first to recognize that our projections had errors. Now our inflation estimates, which were previously upwards, are now downwards especially due to energy prices”, which “are difficult to be expected”, underlined the president of Eurotower. On the new reduction in interest rates, responding to one of the parliamentarians of the Econ commission, Lagarde explained: “I won’t say whether we will cut rates in late spring or early summer but we are confident on the path towards 2%”.
“We are confident that in terms of direction we are moving towards 2% in a timely manner but at the moment we do not have enough to be certain of the solidity” of this outcome “and we do not want to run the risk of a reversal. That is why we need further trust” to act on rates.
“The reasons for strengthening our single currency are stronger than ever – said Lagarde -. The next European elections will be an opportunity for an ambitious program on our economic and monetary union. It is essential that all political forces seize this opportunity to ensure that Europe can respond to the challenges we face.” “The first 25 years of the single currency have been a success but not all the goals of the monetary union have been achieved,” Lagarde explained.
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2024-02-15 16:41:00
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