MNI BRIEF: 'Cautious' Policy Easing Likely in 2024 - Lagarde

The European Central Bank’s president Christine Lagarde is confident that the ECB will be in a position to cut rates by the summer, but remains catious on her overall view on policy easing.

In an interview with Bloomberg TV, Lagarde accepted that rates were now likley at peak, but said it was too soon to declare victory over inflation and was preferable to wait before a first rate cut as the cost of cutting interest rates only to have to hike again would be too high. Asked about current market pricing for cuts, Lagarde said that its not helping the ECB. She said policymakers were attentive to markets, it would be a mistake to “try to second guess” what they are thinking.

She noted that information on wage developments would be clearer in April/May, when many wage negotiations are expected to be concluded.