ECB's Lagarde Signals Temporary Inflation Increase in Q4, Confident in 2% Target, Policy Review in 2025

Sep 30, 2024, 01:04 PM

European Central Bank (ECB) President Christine Lagarde has indicated that inflation may temporarily increase in the fourth quarter of 2024. Despite this, Lagarde expressed confidence that inflation will return to the ECB's 2% target in a timely manner. She also noted that the labor market remains resilient, although employment growth slowed to 0.2% in the second quarter and is expected to decelerate further. Lagarde acknowledged that Europe's economic recovery is facing headwinds, as suggested by some suppressed survey indicators, but she remains optimistic that the recovery will strengthen over time. Additionally, disinflation has accelerated over the past two months. The ECB expects to review its policies in the second half of 2025.