Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

ECB to do everything it takes to get inflation to 2%: Lagarde

Published 14/01/2022, 13:36
Updated 14/01/2022, 14:05
© Reuters. FILE PHOTO: European Central Bank (ECB) President Christine Lagarde gestures as she addresses a news conference on the outcome of the meeting of the Governing Council, in Frankfurt, Germany, March 12, 2020. REUTERS/Kai Pfaffenbach

© Reuters. FILE PHOTO: European Central Bank (ECB) President Christine Lagarde gestures as she addresses a news conference on the outcome of the meeting of the Governing Council, in Frankfurt, Germany, March 12, 2020. REUTERS/Kai Pfaffenbach

FRANKFURT (Reuters) -Euro zone inflation will fall from a record high this year and the European Central Bank is ready to take any measures necessary to get it down to its 2% target, ECB President Christine Lagarde said on Friday.

Inflation rose to 5% last month, the highest on record for the 19-country currency bloc and more than twice the target, as soaring energy costs and supply constraints pushed up prices for a range of goods and services.

The ECB has long argued that price growth will abate on its own but Lagarde said the ECB could adjust policy if needed.

"Our commitment to price stability remains unwavering," she said in a speech. "We will take any measures necessary to ensure that we deliver on our inflation target of 2% over the medium term."

"We understand that rising prices are a concern for many people, and we take that concern very seriously," Lagarde added.

The ECB extended stimulus last month, arguing that longer-term price pressures are actually too weak rather than too high and that inflation was at risk of falling below its target by year-end.

A number of policymakers have challenged that narrative, however, arguing that risks are skewed towards higher readings and that the ECB should start unwinding its extraordinary support measures.

© Reuters. FILE PHOTO: European Central Bank (ECB) President Christine Lagarde gestures as she addresses a news conference on the outcome of the meeting of the Governing Council, in Frankfurt, Germany, March 12, 2020. REUTERS/Kai Pfaffenbach

"We have the flexibility to respond to a range of circumstances," Lagarde said, adding that the drivers of inflation are actually a drag on growth.

"Higher energy prices are cutting into household incomes and denting confidence, while supply bottlenecks are leading to shortages in the manufacturing sector," she said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.