The European Central Bank will do whatever it takes to keep inflation in check, President Christine Lagarde said Wednesday, in the face of ongoing uncertainty caused by the war in Ukraine, high energy prices and the prospect of upwards pressure from new wage deals.
“Our mission, our mandate, our job is to provide price stability - which we define as 2%,” she told an audience at the ECB Forum in Sintra. “We need to do what we have to do, and we shall do so.”
The ECB was not alone in underestimating the persistence of inflationary effects of rising fuel costs and supply chain bottlenecks for the global economy, Lagarde said, but had been the first central bank to admit the error. Monetary policy is “not a science, there is an element of art. We know that models have had their shortfalls, particularly at turning points,” she added.