“We expect inflation in the medium term to stabilize below our target“, said on Friday the president of the European Central Bank (ECB), Christine Lagarde, in an interview with La Provence.
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“Our inflation projections for this year are around the 2% level, which is something we haven’t seen in more than eight years.”
“However, the price increase should slow down to 1.5% in 2022 and 1.4% in 2023.”
“The double monetary lever applied by the ECB and the fiscal policies applied by governments and the European Union are fueling the recovery. We see a rise in prices that is especially driven by two basic effects.”
“The first concerns gasoline prices, which plummeted to less than $ 25 per barrel during the pandemic before rising back to around $ 75 per barrel today.”
“The second base effect refers to Germany, where the VAT rate, which had been lowered last year to support the recovery, was reinstated on January 1, 2021.”
“However, these base effects will not last. We will see a return to lower inflation rates as indicated in our projections.”
“Prices must increase in a gradual, stable and sustainable way.”
“For this we need a sustainable economic recovery. But we are not there yet.”
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