Lagarde (rate hike): “We will follow this path. Inflation is very high.”

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Lagarde (rate hike): "We will follow this path. Inflation is very high."

“We will have another rise at the next meeting. Inflation is very high, we have to take the necessary measures to reduce it. I repeat, inflation is too high.” This is how resounding Christine Lagarde, president of the European Central Bank (ECB), has shown herself this Thursday in an interview on Antena 3 TV.

The ECB will raise interest rates by 50 basis points in its Meeting on March 16, up to 3.50%. When asked if there will be new increases, Lagarde has repeated that “we will depend on the data, it is the most important element. There will be a rise of 0.50% in the next month. We will follow this path but it is not certain that they will rise in the coming months. The data will make us make decisions or not. We want inflation to go down to 2%.”

Lagarde has warned that “interest rates will not return to where they were 3-4 years ago, the Euribor was negative, these rates cause inflation to fall. Our projection is that inflation will return to 2% in 2025. It’s a pretty decent rate.”

Another question has been whether the ECB made a mistake by not raising interest rates in the last 11 years. “In June 2022 we decided to raise interest rates and we did it consistently, we could have started earlier, yes… But there wouldn’t have been a big change. I focus on lowering inflation,” Lagarde responded.

Regarding the economic situation in Europe, the president of the ECB has said that “it is a mistake to compare Europe with the United States, it is different. With the war in Ukraine… Everything has been different.”

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