Dovish Lagarde speech reassures expectations of no consecutive ECB rate cuts

Soft landing ‘not guaranteed’

The European Central Bank's president Christine Lagarde has outlined that the institution lacks the necessary data to prove that inflationary threats have passed, bolstering economists’ expectations that the Bank will not proceed with consecutive rate cuts as its next monetary policy meeting.

Speaking at the ECB's annual retreat in Sintra, Portugal, Lagarde opened the three-day event with a speech titled ‘Monetary policy in an unusual cycle: the risks, the path and the costs'. She said members of the congregation agreed that the economy was "undergoing substantial change" but held "diverging views" about where it was headed to. ECB cuts interest rates for the first time since 2019 According to her "this lack of clarity presents a profound challenge for policymakers, as we must try at once to understand these transformations and to steer the economy through them". The...