The president of the European Central Bank (ECB), Christine Lagarde, publicly demonstrated a hawkish posture last Thursday in Berlin. The maximum authority of the Eurobank employed an especially aggressive tone to convey a double message to the European public opinion.
The first point of Lagarde's message indicated that the European economy resisted the shock of the Middle Eastern conflict somewhat better than expected. However, the second point made clear that, in the current situation, inflation is here to stay in a prolonged manner.
In this context, the ECB president is preparing new short-term interest rate hikes as a tool to combat this persistent inflation. The restrictive monetary policy strategy aims to tame the pressure on prices in the eurozone.
Rumors about a possible early departure of Lagarde from the ECB, whether to Davos or to French politics, have intensified in recent weeks, although she remains at the helm of the European monetary institution for now.
