ECB Lagarde says many reasons for inflation are temporary: CNBC

Texas News Today

FILE PHOTO: European Central Bank (ECB) President Christine Lagarde attends a news conference on the outcome of the board meeting in Frankfurt, Germany September 9, 2021. Reuters / Kaaffeenbach

September 24, 2021

FRANKFURT (Reuters) – Many of the factors behind the recent surge in eurozone inflation are temporary and will decline next year, European Central Bank Governor Christine Lagarde said in an interview broadcast on CNBC on Friday. Rice field.

Eurozone prices are rebounding faster than expected as the economy resumes after the pandemic lockdown, and some ECB policymakers say inflation is close to next year’s ECB target of 2%. Some people think it is overkill.

Lagarde attributed many of the increases to supply turmoil and said inflation should stabilize next year.

“Many of the reasons for price increases are temporary, so we are confident that they will return to a more stable position next year,” Lagarde said.

“When you look at what’s causing it, much of it is related to energy prices.”

He said “things will work out” when new sources are found, but warned that energy prices could continue to rise as they relate to the transition from fossil fuels.

Lagarde expects a “movement” to be at the forefront of inflation when the labor market tightens, but there is still “many grounds to cover”, including at least one lower than before the COVID-19 pandemic. Millions more are unemployed. I said.

The ECB also made a distinction between the ECB, which plans to continue printing for some time but this month began to reduce emergency bond purchases, and the Federal Reserve Board, which said this week it would Planning to start reducing purchases. I sought. Make plans soon.

“There’s a slim factor in how they (FRB) created support packages for the economy, but we’re not in that position,” Lagarde said. “We are currently calibrating and have started the calibration.”

When asked about the turmoil affecting Chinese real estate firm Evergrande, Lagarde said, “Direct exposure will be limited, especially in the euro area.”

(Reporting by Francesco Canepa, edited by Clarence Fernandez and John Boyle)

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