Christine Lagarde, ECB President, addressed the European Parliament’s Committee on Economic and Monetary Affairs, discussing the euro area economy, monetary policy tools, and future policy considerations.
Christine Lagarde, President of the European Central Bank (ECB), delivered a speech at the hearing of the Committee on Economic and Monetary Affairs of the European Parliament. This marks her fourth address to the Committee this year.
She highlighted recent technological, geopolitical, and structural changes impacting the economy, emphasizing the need to enhance Europe’s resilience and competitiveness.
Lagarde provided an outlook for the euro area, noting a 0.2% growth in the third quarter supported by domestic demand, with services expanding and manufacturing facing headwinds from tariffs and stronger euro. Future growth is expected to benefit from increased household spending, infrastructure, and defense investments, though global trade uncertainties remain a risk.
Inflation was reported at 2.2% in November, close to the ECB’s 2% target, supported by moderate wage growth. The ECB’s monetary policy remains unchanged, with interest rates held steady, and decisions based on upcoming economic projections.
Lagarde outlined the ECB’s monetary policy instruments, including Outright Monetary Transactions (OMTs), the Transmission Protection Instrument (TPI), and the Pandemic Emergency Purchase Programme (PEPP). These tools aim to ensure effective transmission of monetary policy and address market distortions, especially during crises.
She emphasized the ECB’s commitment to flexible responses and the importance of other policies, such as the European Commission’s initiatives on capital market integration, to strengthen Europe’s economic prospects and reduce vulnerabilities.
Lagarde concluded by reaffirming the ECB’s dedication to maintaining price stability and supporting economic resilience through adaptable policy measures.
