Lagarde: Inflation Pressures Stemming In Part From Euro Depreciation

Lagarde goes on with her prepared statement, commenting on inflation dynamics:

• Persistent supply bottlenecks for industrial goods and recovering demand in the service sector are contributing to the high rate of inflation. Price pressures are spreading across more and more sectors. In part owing to the indirect impact of high energy costs across the whole economy. Most measures of underlying inflation have risen higher. Inflation will remain undesirable high for some time.
• Higher inflation pressures are also stemming from the depreciation of the euro exchange rate. In the absence of further disruptions, easing supply bottlenecks and stabilisation in energy prices should support the return of inflation to target.
• The labour market remains strong. Wage growth, according to forward looking indicators, has continued to increase gradually in recent months while remaining contained overall. Over time the strengthening of the economy and catch-up effects should support wage growth. Longer term inflation expectations stand around 2%.