Christine Lagarde remains confident that food and energy prices will stop rising, which should help the euro area avoid a combination of economic stagnation and high inflation. The ECB President said this at her briefing on Wednesday.
Recent inflation growth
Inflation is becoming a real problem in the euro area countries. Experts estimate that it approached the 10 percent mark in Spain this month and will exceed 7 percent in Europe’s largest economy, Germany. The rate of price increases in the European Monetary Union has set a new historical record virtually every month since the currency block was established in 1999.
ECB president optimistic about future development
However, according to European Central Bank President Christine Lagarde, it is difficult to predict how far inflation will rise, as the war in Ukraine is creating great uncertainty. However, she believes that energy and food prices will stabilise, albeit at high levels.
“We know today that inflation will be higher this year, there is no doubt about that. But at the same time, we can see what factors are causing the current inflation. We are also confident that these factors will subside and that energy and food prices will stop rising,” the ECB chief added. Lagarde therefore believes that the euro area can avoid stagflation.
