Image: Arne Dedert (German Press Agency GmbH)
The European Central Bank (ECB) will, according to… Lagarde only lower key interest rates when inflation has fallen to the two percent mark. “I think the hardest part is behind us,” said Lagarde on Thursday in a program on the France 2 television channel with a view to the fight against inflation. Interest rates are likely to have reached their highest level.
“I think that, barring any further shocks or unexpected data, interest rates will not continue to rise. And if we win our battle against inflation and are confident that inflation will actually be at two percent, then interest rates will sink.”
When asked if 2024 would be the year interest rates would be cut, answered Lagarde: “As President of the European Central Bank, I cannot give you a date.” Lagarde also downplayed fears that transportation problems in the Suez and Panama Canals could lead to higher prices. Investors on the stock market are currently assuming that the ECB will cut interest rates several times this year, with the first step expected as early as March or April. These expectations conflict with statements from a number of ECB monetary authorities.
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