European Central Bank President Christine Lagarde has warned of high inflation in Europe, while the European Central Bank is considering another interest rate hike in December.
Inflation in the Eurozone is expected to remain high in the coming months, while the European Central Bank (ECB) is considering the possibility of another interest rate increase in December. The warning comes from ECB President Christine Lagarde in an interview with the Japanese newspaper Yomiuri Shimbun.
Lagarde said she still cannot confirm whether interest rates will rise next month, but stressed that there are currently no signals indicating a change in the trend of inflation.
“We know that inflation rates will remain high during the coming quarters,” she said.
According to Lagarde, the ECB is closely monitoring multi-year wage agreements, companies’ expectations for wage growth and other economic indicators to determine the next steps. Currently, inflation in the Eurozone is double the ECB’s 2% target. For this reason, some officials have signaled a possible increase in interest rates by 0.25 percentage points in December.
Such a decision would follow two previous increases, undertaken after energy prices rose as a result of the war against Iran. However, according to Bloomberg, the main concern is how much borrowing costs can rise further without damaging the economy of the 21 Eurozone countries.
Meanwhile, Lagarde, 70, has announced that she will leave the ECB leadership in February, about nine months before the end of her mandate. Competing to succeed her are the Dutchman Klaas Knot and the Spaniard Pablo Hernandez de Cos.