Lagarde highlights “reinforced confidence” of the ECB to tame inflation to 2%

Published on October 1, 2024 BRUSSELS, September 30 (EUROPA PRESS) – The president of the European Central Bank (ECB), Christine Lagarde, highlighted this Monday in Brussels that “the latest events reinforce the confidence” of the banking institution in which Inflation “will return to the 2% target in due course,” something that will happen at the next monetary policy meeting in October. This was stated this Monday before the MEPs of the Economic and Monetary Affairs Committee of the European Parliament in what was his first intervention of the tenth legislature before this forum. Lagarde has reiterated that interest rates will remain “sufficiently restrictive for the time necessary to achieve the objective” and has advanced that she does not commit “in advance to following a specific rate path.” The Governing Council of the ECB decided to lower interest rates by 25 basis points in September, so that the deposit rate (DFR) will remain at 3.50%, thus following the planned scenario. “New data available at the time of the September Governing Council meeting reinforced our confidence that inflation would return to our 2% target in due time. For this reason, we reduced the deposit facility rate, which is the rate through which we guide the direction of monetary policy, by another 25 basis points, to 3.5%,” Lagarde explained. On the other hand, he has once again insisted on the need to advance the Capital Markets Union to integrate the “fragmented” markets of the Member States and thus promote risk diversification and shock absorption throughout the EU. “In this way, financial stability would be supported and the transmission of monetary policy would be facilitated,” he pointed out, to which he added that the EU “lacks the luxury of time to exclude any possible option” that would allow the third round to be completed. part of the Banking Union, something “urgent and imperative” to prevent the EU's competitiveness from being compromised against rivals such as China or the United States.