The president of the European Central Bank (ECB), Christine Lagarde, promised on Friday that the institution she leads will do everything possible to fight inflation, in a video message addressed to Europeans worried about the decrease in their purchasing power, reports AFP.
“We are raising the interest rate and will continue to raise it, at a sustained pace, until it is at the level that will ensure a rapid return of inflation to our medium-term target of 2%. And we will succeed”Christine Lagarde said in her video message.
The ECB is fighting inflation
Starting from July, the ECB increased the reference interest rate at the fastest rate ever recorded in the history of the institution, the cost of credit in the euro area being increased by 2.5 percentage points so far, of which an increase of 50 basis points was decided at the December monetary policy meeting.
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High inflation “it affects everyone, especially the poor. I promise you that we will do everything possible to reduce inflation”, added the former French Minister of the Economy at a time when the decrease in purchasing power, as a result of the price explosion, has become a major concern for Europeans.
Raising the base interest rate by 50 basis points, at the last monetary policy meeting, could become “the new normal in the short term”, the vice-president of the ECB, Luis de Guindos, said separately in an interview with the French daily Le Monde.
The president of the European Central Bank (ECB) promises that he will manage to control inflation
At the end of 2021, Christine Lagarde continued to state that, most likely, interest rates will not be increased during 2022, given that at that time inflation was perceived as a passing phenomenon. But the war launched by Russia against Ukraine led to the explosion of energy prices and consequently to accelerated inflation in Europe, all culminating in an annual inflation rate of almost 11% in the Eurozone in October.
On a happier note, Christine Lagarde wanted to welcome Croatia to the euro zone, which on January 1, 2023 will become the 20th member country of the single zone. An event that the president of the ECB promised to celebrate.
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