Business Maverick: Lagarde Says Would Be ‘Surprised’ If Euro-Zone Inflation Has Peaked

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European Central Bank President Christine Lagarde said she’d be surprised if euro-zone inflation had peaked, suggesting the recent ramp-up in interest rates isn’t close to being over.

“I would like to see inflation having peaked in October, but I’m afraid that I would not go as far as that,” she told European lawmakers Monday in Brussels. “There is too much uncertainty, particularly in one component, that is the pass-through in high energy costs at wholesale level into retail level, to assume that inflation has actually reached its peak. It would surprise me.

Some members of the 25-strong Governing Council have already called for a slower pace — particularly as plans to start unwinding the roughly €5 trillion of bonds bought in recent crises come together. “How much further we need to go, and how fast we need to get there, will be based on our updated outlook, the persistence of the shocks, the reaction of wages and inflation expectations, and on our assessment of the transmission of our policy stance,” Lagarde said.

 

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