Lagarde pushes back on markets
- Phase of higher inflation to last longer than expected (but still temporary)
- We continue to see inflation in the medium term below target
- We looked deeply at inflation but we're confident that our analysis of inflation is correct
- Did soul searching on inflation but concluded it was correct
- PEPP in my view will end in March
- It's not for me to say if markets are ahead of themselves
- We will be very attentive to wage inflation
- As of now, we have no reason to see second round wage effects
The euro jumped but she's pushing back on market pricing for rate hikes, which show a 20 bps hike in Dec 2022.
"Our analysis certainty does not support that the conditions of our forward guidance are satisfied at the time of liftoff as expected by markets, nor any time soon thereafter."
"We very deeply looked and tested our analysis of the drivers of inflation and we are confident that our anticipation and our analysis is actually correct."
That puts the ECB on the other side of some other central banks that are increasingly worried about inflation.
