The European Central Bank (ECB) is determined to return the Eurozone inflation to its 2% target by 2025, Christine Lagarde, the bank’s president, said in a recent interview.
Last month, a halt in interest rate hikes was introduced after the bank increased its benchmark deposit facility rate by 25 basis points (0.25 percentage points) to a record high of 4.0% at its last meeting in September, following repeated interest rate hikes over the past year as a result of skyrocketing inflation across the currency zone.
The European financial institution has vowed to sustain these high interest rates over an extended period, which Lagarde explained are expected to gradually pull inflation back to the 2% mark. Inflation in the eurozone fell to 2.9% in October, according to the EU's statistics office Eurostat, the lowest level in more than two years.
In a recent interview with the Greek newspaper Kathimerini posted on the ECB’s website, Lagarde said the ECB is "determined to bring inflation down to 2%" and that according to its projections, this can be done by 2025.
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Lagarde said she isn’t worried about the political implications of the central bank’s efforts to combat inflation, which have been criticised by some southern European countries, who argued that this decision will lead to an economic downturn.
"Our mandate is to ensure price stability, and this is the best contribution we can make to social peace and to society, to the most vulnerable of its members in particular," Lagarde concluded.
