ECB's Lagarde: Today wasn't an isolated decision; 75 bps isn't the norm

• Determined action had to be taken
• Today wasn't an isolated decision
• Risks to inflation tilted to the upside, risks to growth to the downside
• Next hike not necessarily 75 bps, not the norm
• We will determine on a meeting-by-meeting basis the level that will get inflation back to 2%
• Initial signs of inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term expectations above target warrant monitoring
• Wage growth still contained
• Where we are at is not the neutral rate
• Decision was unanimous, there were different views around the table
• Downside scenario for growth includes negative growth in 2023, sees negative growth in 2023
• We are 'so far away' from a policy setting that will be enough to bring down inflation
• We don't know what the terminal rate is

Lagarde is certainly taking a hawkish stance but it's backfiring in the FX market with worries about growth and debt sustainability hurting.

EUR/USD is down 60 pips to 0.9940.