Lagarde: The Fight Against Inflation is Making Progress

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Lagarde: The Fight Against Inflation is Making Progress

Forex - European Central Bank (ECB) President Christine Lagarde stated during the press conference following the ECB's rate cut, "The process of fighting inflation is progressing. We will reach the 2% level by 2025."

Lagarde pointed out that growth is losing momentum, saying, "We are determined to ensure that inflation sustainably stabilizes at our medium-term target of 2%. We will adopt a data-dependent and meeting-by-meeting approach in determining the appropriate monetary policy stance. In particular, our interest rate decisions will be based on our assessment of the inflation outlook in light of incoming economic and financial data, the underlying dynamics of inflation, and the strength of monetary policy transmission."

Lagarde indicated that the economy, although growing at a slower pace than previously expected, will strengthen over time, stating, "Provided that trade tensions do not escalate, more affordable loans will increase consumption."

Emphasizing the risks to inflation, Lagarde remarked, "Upward risks to inflation stem from geopolitical tensions that could raise energy prices and freight costs and disrupt global trade. Additionally, extreme weather events and the broader climate crisis could drive food prices higher than expected. Conversely, if low confidence and concerns over geopolitical events prevent consumption and investment from recovering as quickly as anticipated, or if monetary policy reduces demand more than expected, or if the economic environment elsewhere in the world unexpectedly worsens, inflation could have a downward surprise."