European Central Bank (ECB) President Christine Lagarde stated that the ECB is close to reaching its inflation target in the Eurozone.
Lagarde evaluated the economy and the ECB’s monetary policy in the Financial Times podcast.
“We are getting very close to the point where we can declare that we have brought inflation to 2 percent sustainably in the medium term.” Lagarde warned that one should be very careful about inflation in the services sector.
Lagarde said, “You know, according to our latest figures, inflation is at 2.2 percent. But the services sector is still at 3.9 percent and barely moving. It fluctuates around 4 percent.” he said.
On the other hand, ECB President Lagarde signaled a further interest rate cut in January on December 16, saying, “The current policy stance is restrictive. However, if incoming data continues to confirm our baseline, the trend will become clear and we expect interest rates to fall further.” He used the expression.
Meanwhile, last week the ECB’s leading representatives signaled further interest rate cuts next year, given declining inflation risks and a weak economy.
ECB Chief Economist Philip Lane stated on November 20 that the ECB did not have to keep interest rates at a restrictive level in light of the latest developments in inflation.
“What we’re seeing now is that inflation dynamics are more likely to move towards the 2 percent level in the future,” Lane said. He used the expression.
On December 12, the ECB made its fourth interest rate cut against the weakening economy in line with market expectations, reducing the three main policy rates by 25 basis points.
The bank reduced the deposit interest rate from 3.25 percent to 3 percent.
The next interest rate meeting of the ECB will be held on January 30 (2025).
