Berlin, March 17 (EFE). Inflation in eurozone countries may exceed 7% in 2022 as a result of the impact of the war in Ukraine on energy and food prices, the head of the European Central Bank said on Thursday. ), Christine Lagarde.
Lagarde, who, however, predicted average inflation would likely be around 5.1%, added that the medium-term target of 2% could be maintained, although he cautioned that the ECB’s monetary policy would depend on the economic impact for war.
Lagarde added that the highest level of inflation corresponds to the worst-case scenario estimated by European Central Bank experts, and stressed that “energy prices are expected to be high for a longer period”, and reminded that gas prices have risen by 73% since the beginning of 2022.
The European Central Bank president, who addressed the forum, said the European Central Bank and its eligibility elements “in Frankfurt (southern Germany).
Lagarde warned that global manufacturing bottlenecks, which have begun to disappear in recent months, are likely to remain in some sectors, with consequences for consumer durables prices.
But given the current situation, the president of the European Central Bank assured that the institution she heads “will take all necessary measures to ensure price stability and protect financial stability.”
As a result of inflationary pressures, Lagarde acknowledged that “Europeans will face higher inflation and slower economic growth in the short term.”
He acknowledged that “high energy prices are likely to reduce household savings accumulated during the pandemic” and expected that they would be diverted towards expenditures related to energy consumption.
Lagarde acknowledged that businesses will also be affected, noting that past geopolitical events such as the Gulf Wars or the attacks on the United States in 2001 have led to a decline in investment in advanced economies. EFE
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