The euro zone economy is facing exceptional shocks from trade, defence and climate issues, possibly amplifying inflation volatility and raising the risk that price growth becomes more persistent, ECB President Christine Lagarde said on Wednesday. These forces make it impossible for the ECB to signal policy intent but make it imperative the bank doubles down […]
ECB President Lagarde warned that trade, defence, and climate shocks pose inflation risks for the Eurozone, making policy signaling impossible. While these shocks could drive inflation higher, they might also counteract each other. Lagarde emphasized the ECB's commitment to its 2% inflation target and the need to clarify its response to various shocks, acknowledging the limitations of its control and guidance.
