Former IMF head Lagarde silences speculation, reaffirms commitment to ECB role

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European Central Bank (ECB) President Christine Lagarde said Monday that she would remain in place to ensure inflation stays in check despite the war in the Middle East, months after a report that she would step down.

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“I have a sense of duty and I believe that when there’s a bit of a storm, the captain remains on deck. So the captain of the European Central Bank is on deck,” Lagarde told France Culture radio.

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The 70- year-old French brainbox previously served as the 11th Managing Director of the International Monetary Fund from 2011 to 2019

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The Financial Times said in February, citing an anonymous source, that Lagarde would leave before October 2027.

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That would give French President Emmanuel Macron and German Chancellor Friedrich Merz time to line up a successor ahead of France’s presidential vote in April 2027, in case of a victory by the euro-sceptic far-right National Rally.

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Lagarde had declined to comment directly on the report.

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“What I could have considered last February was in a particular situation” where inflation was near the bank’s benchmark rate of two percent and “the digital euro was on track” to getting legislative approval, Lagarde said Monday.

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“So I could say to myself with a degree of confidence that the mission was accomplished, that I was 70 years old and in the end, I could perhaps retire a bit earlier than planned,” she said.

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But the ECB last week raised its deposit rate to 2.25 percent to curtail rising inflation sparked by the US and Israeli war against Iran, which sent oil and gas prices soaring.

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“My duty is to accomplish the mission, price stability, and for the moment that is what guides my action,” she said, adding that she wanted to “hand over the keys to an ECB that will have guaranteed” that stability.

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AFP

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