ECB president vows to tame inflation


In her speech, Lagarde also praised the euro, describing it as the “engine of integration” of Europe…reports Asian Lite News

The president of the European Central Bank (ECB) has vowed to bring down soaring inflation in the eurozone to its 2 percent target level “in a timely manner.”

This is an “immediate and over-riding priority” for the Bank, Christine Lagarde said at an event held in Frankfurt on Wednesday to celebrate the 25th anniversary of the ECB.

In her speech, Lagarde also praised the euro, describing it as the “engine of integration” of Europe.

The single currency was the “logical answer” to the changes that emerged from the late 1980s, she said, including the expansion of the euro zone from 11 to 20 members. The euro “offered Europeans stability, sovereignty and solidarity”.

Although the single currency was put to test when a debt crisis hit the EU, as well as during Brexit, Lagarde said people were now able to separate institutions from policies.

“They may like or dislike the policies of the ECB, but they mostly no longer question whether being part of the euro area is the right choice,” she said.

Meanwhile, Lagarde pledged to reduce high inflation in the eurozone as the institution that safeguards the euro marked its 25th anniversary.

“For the ECB, our immediate and overriding priority is to bring inflation back down to our two percent medium-term target in a timely manner,” Lagarde told around 200 guests at an event to mark the occasion. And we will do so,” she said, while warning that “there will be more challenges ahead which the ECB will need to address. We must continue to provide stability in a world that is anything but stable”.

The ECB laid out a blue carpet for the birthday party at its imposing steel-and-glass tower in Frankfurt, Germany’s financial capital.

The event featured renditions of music by French composer Claude Debussy and a mango-flavoured cake cut by Lagarde and two of her predecessors, Jean-Claude Trichet and Mario Draghi.

German Chancellor Olaf Scholz was also among the guests.

“Last year we have seen the highest inflation rates since the creation of the euro. The consequences are being felt by citizens all over Europe,” Scholz said.

“It is good to know that when we are celebrating this special occasion here tonight, the ECB is actively fighting inflation.”

Inflation in the eurozone surged to record highs over the past year as Russia’s invasion of Ukraine drove up energy prices, and as the recovery from the Covid pandemic caused widespread supply chain woes.

The closely watched indicator stood at seven percent in April – down from a peak of 10.6 per cent in October but still well above the ECB’s 2 per cent target.

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