Lagarde Flags Forward Guidance Change In July, Deeper Changes Down The Road

Below are some key snippets from the latest BBG interview with ECB President Lagarde, which has hit in the last few minutes:

• Lagarde signalled that the upcoming July meeting will now have "some interesting variations and changes."
• "It's going to be an important meeting. Given the persistence that we need to demonstrate to deliver on our commitment, forward guidance will certainly be revisited."
• Lagarde stressed that she expects the ECB's current bond-buying plan to run "at least" until March 2022. That could then be followed by a "transition into a new format."
• "We need to be very flexible and not start creating the anticipation that the exit is in the next few weeks, months."
• "We're going to look at the circumstances, we're going to look at what forward guidance we need to revisit, we're going to look at the calibration of all the tools we are using to make sure it is aligned with our new strategy."
• Lagarde agreed that the Banks new inflation target may "take a little longer" to achieve.
• She stressed that the ECB has to "use the tools, and we have a big toolbox, to actually deliver that 2%."