Lagarde declared ECB's closeness to victory over higher inflation

European Central Bank (ECB) President Christine Lagarde said in an interview with CNBC that the regulator has almost achieved its goal of bringing inflation back to 2%. However, she emphasized the importance of maintaining a flexible approach amid the uncertain global economic environment.

Lagarde said she and her colleagues must prioritize incoming statistics when deciding whether to extend or pause the cycle of interest rate cuts that began in June 2024. For the moment, however, the pace of consumer price growth is returning to the target level, she noted. Citing “exceptional” uncertainty, largely driven by US President Donald Trump's trade tariffs, the regulator’s officials expressed concern about the outlook for the eurozone economy.

Last week, after the seventh borrowing cost reduction in this cycle, the ECB representatives were terse about their plans. Meanwhile, according to Bloomberg, investors have raised their forecasts for ECB monetary policy easing, expecting two or three more cuts in the European regulator's deposit rate by a quarter point each this year.