Lagarde says eurozone inflation still lacks second-round effects
In short
ECB President Christine Lagarde said eurozone inflation is rising because energy prices have gone up. She said second-round effects on wages have not yet been seen, and inflation may approach 4%.
This matters because the ECB may keep a cautious approach at its next meetings. It is still unknown if or when interest rates will change.
What the reporting says
ECB President Christine Lagarde said eurozone inflation is rising on higher energy prices and has not yet triggered second-round effects on wages, according to a market summary. The report says inflation could approach 4% and that the ECB will keep a cautious policy stance ahead of upcoming rate meetings. The exact size or timing of any rate move was not stated.
Why it matters
Christine Lagarde said eurozone inflation is being pushed up by higher energy prices, but second-round wage effects have not yet appeared. The report says inflation could approach 4% and that the ECB will stay cautious as it considers interest-rate decisions at upcoming meetings. The impact is mainly on monetary-policy expectations and market pricing, while the exact policy outcome remains unknown.