“Core inflation in the eurozone will remain high in the near term, so a 50 basis point rate hike by the European Central Bank (ECB) later this month is increasingly safe.“, ECB President Christine Lagarde told Spanish media group Vocento, Reuters reports.
Lagarde said in her speech on Sunday, according to Reuters, that the reported rise is now “very very likely”But he also warned that core inflation, which strips out volatile food and fuel prices, could remain uncomfortably high even as the headline inflation rate falls in the coming months.
“In the short term, core inflation is going to be high“, according to Lagarde.
Lagarde also stated that the ECB must continue to take the necessary measures to bring inflation back to 2%. “The eurozone economy is holding up better than feared and production should pick up from a point close to stagnation in the last quarter of 2022,” adds the president of the central bank.
Source: Fx Street
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