European Central Bank President Christine Lagarde said on Thursday that a “moderate” recession in the eurozone was looming, but that it would not be enough to achieve down recordHigh inflation.
inflation in 19 countries currency club increased to 10.7% in October, more of five times The second European Central Bankpercent The goal, as Russia’s war in Ukraine leads energy prices higher.
Speaking at a banking conference in Riga, Lagarde said ‘moderate stagnation’ was possible in late 2022 and in In early 2023, rising consumer prices and the continent’s energy crisis dampened economic activity.
“But we don’t think this recession will be enough to tame inflation,” she warned. more benefit rate The heights were coming.
European Central Bank last The week revealed another huge benefit rate to rise of 75 base pointsThe second Such as move Since September and the third rate Increase since July, after a decade of Historically low borrowing costs for euro region.
Lagarde warned of that higher Borrowing costs can deepen the pain of Economic downturn, but the European Central Bank – like Other central banks – is for Now give priority fight against inflation.
In the United States, the Federal Reserve (Fed) on Wednesday raised prices to highest level in 15 years and indicated that other increases will do follow.
“We have to be vigilant of each other and we have to be aware of the potential repercussions and repercussions, as I think the Federal Reserve is also Realizing of it, said Lagarde.
European Central Bank board Member Fabio Panetta warned that the Frankfurt Foundation should pay “close attention” to the impact of more expensive Borrowing costs on Households and consumers as the global economic outlook grows bleaker.
“Bigger than expected rate May lead to increased volatility and have a stronger effect in The current indebtedness environment After a decade of “Very low prices, abundant liquidity,” he told a financial conference. in Frankfurt.
“When calibrating our position, we need To pay close attention to ensure not inflated risk of prolonged stagnation or trigger market Take off, “Panita added.
