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Eurozone Inflation Expected to Stabilize at 2 Percent
(MENAFN) European Central Bank (ECB) President Christine Lagarde declared Monday that medium-term eurozone inflation will anchor at 2%, despite dipping beneath that threshold earlier this year.
Speaking during a European Parliament (EP) plenary session in Strasbourg, Lagarde defended the central bank's decision to maintain borrowing costs at 2% for a fifth consecutive meeting last week, stating: "In the current uncertain environment, our data-dependent, meeting-by-meeting approach to monetary policy serves us well."
"We will continue to follow this approach, basing our decisions on our evolving assessment of the inflation outlook and the risks surrounding it, in light of the incoming economic and financial data, as well as the dynamics of underlying inflation and the strength of monetary policy transmission," she stated.
Lagarde outlined the bank's mission to tame price pressures as essential to bolstering Europe's economic foundations, noting that resilience and competitive strength require more than monetary tools alone—demanding comprehensive policy coordination.
Flagging sluggish productivity and anemic expansion across the currency bloc, the ECB chief urged lawmakers to enact critical structural overhauls.
Digital Euro Strategy
Unveiling an extensive blueprint for central bank currency evolution, Lagarde reaffirmed cash's enduring role while positioning a "digital euro" as vital to Europe's economic independence.
Such a system "would be built on a fully European infrastructure, avoiding an excessive dependency on foreign providers for payments systems that are critical to the functioning of our economy," Lagarde explained.
Characterizing the digital currency as a protective barrier for European commerce, she underscored plans for completely homegrown technological architecture.
Lagarde revealed the ECB is pursuing broader digital asset development beyond individual transactions, targeting tokenization's transformative capabilities.
Meanwhile, January saw annual eurozone inflation plunge to 1.7%—below the bank's 2% objective—driven by collapsing energy costs early in the year.
The ECB maintains its 2% inflation mandate across all euro-member nations.
Speaking during a European Parliament (EP) plenary session in Strasbourg, Lagarde defended the central bank's decision to maintain borrowing costs at 2% for a fifth consecutive meeting last week, stating: "In the current uncertain environment, our data-dependent, meeting-by-meeting approach to monetary policy serves us well."
"We will continue to follow this approach, basing our decisions on our evolving assessment of the inflation outlook and the risks surrounding it, in light of the incoming economic and financial data, as well as the dynamics of underlying inflation and the strength of monetary policy transmission," she stated.
Lagarde outlined the bank's mission to tame price pressures as essential to bolstering Europe's economic foundations, noting that resilience and competitive strength require more than monetary tools alone—demanding comprehensive policy coordination.
Flagging sluggish productivity and anemic expansion across the currency bloc, the ECB chief urged lawmakers to enact critical structural overhauls.
Digital Euro Strategy
Unveiling an extensive blueprint for central bank currency evolution, Lagarde reaffirmed cash's enduring role while positioning a "digital euro" as vital to Europe's economic independence.
Such a system "would be built on a fully European infrastructure, avoiding an excessive dependency on foreign providers for payments systems that are critical to the functioning of our economy," Lagarde explained.
Characterizing the digital currency as a protective barrier for European commerce, she underscored plans for completely homegrown technological architecture.
Lagarde revealed the ECB is pursuing broader digital asset development beyond individual transactions, targeting tokenization's transformative capabilities.
Meanwhile, January saw annual eurozone inflation plunge to 1.7%—below the bank's 2% objective—driven by collapsing energy costs early in the year.
The ECB maintains its 2% inflation mandate across all euro-member nations.
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