Lagarde: Data Show Strength In Services Activity And Prices

ECB President Lagarde begins the post-meeting press conference by reading the Monetary Policy Decisions statement released earlier.

• On the economic landscape, Lagarde says: Private domestic demand, especially consumption is likely to have remained weak. Bus/cons confidence remain weaker than pre-Ukraine war.
• Manuf sector working through a backlog of orders but prospects worsening. Services sector growing more strongly as economy reopens.
• Ave hours worked somewhat below pre-pandemic levels and recovery has stalled.
• Re inflation: 7.0% Y/Y in April - base effects led to some increase in energy inflation. Services pushed up by reopening of economy and wage pressures.
• Wage pressures strengthened further as consumers recoup some of their lost real income. Most inflation exp around 2% but some have edged up.