Christine Lagarde said the European Central Bank would act in “a determined and sustained manner” to tackle record inflation in the eurozone, especially if there were signs of price expectations rising sharply among consumers and businesses.
“Inflation in the euro area is undesirably high and it is projected to stay that way for some time to come,” the ECB president told its annual forum in Sintra, Portugal, on Tuesday, in a hardening of her comments on price growth. “This is a great challenge for our monetary policy.”
“Inflation pressures are broadening and intensifying”, Lagarde added. Eurozone wage growth is expected to double to 4 per cent this year, she said, adding that supply bottlenecks were likely to be persistent and there was no sign of an end to high energy and commodity prices caused by Russia’s invasion of Ukraine.