Christine Lagarde, President of the European Central Bank, is the guest of the Grand interview of France Inter. According to the former economy minister, inflation will drop in 2022.

The inflation rate in the euro zone reached 5% in December. Prices increase. “What is driving this price increase? At 50%, it is the price of energy, all categories combined: oil, gas, electricity.“According to Christine Lagarde, inflation is nevertheless”less influenced by the price of oil and more influenced by the price of gas“Regarding the gas,”because of climatic and geopolitical phenomena, we are facing a price increase which has an effect on the price of electricity.”

In France, according to Christine Lagarde“we are in a rather good situation. On an annual basis, we were at 3.2% inflation, compared to a European average of 5.” Estonia, for example, is at 12% and Germany is at its highest for 30 years, at more than 5%. Besides energy, the other reason for inflation in Europe is “congestion in ports”. “We think that these two phenomena will slowly stabilize and decrease“.

Inflation will fall in 2022

Inflation goes like this"stabilize and gradually decline during 2022“ assures Christine Lagarde.It will drop less than we had envisaged, but it will drop. According to our December estimates, inflation would be 3.2% in 2022 (...) and significantly less in France." The ECB President also foresees a drop in 2023 and 2024.”Energy prices will not continue to rise indefinitely and traffic jams will eventually subside."

Criticized in some countries, the President of the ECB reacts. "We cannot act immediately. If I raise interest rates, that will have an effect within 6 to 9 months. The time it goes down the chain of funding. But growth is being held back."

It's time to stop the "whatever it takes"

Regarding the economic policy to be implemented in the face of the crisis, Christine Lagarde believes that a "new economic recovery plan does not seem to me necessary in the current state of activity. We have a solid activity, significant growth. We have a good recovery that we must not slow down." Whatever it takes has "served well". "We collectively avoided a much more serious crisis and a deeper and more lasting crisis so it was legitimate but now we have to get out."

Debt in France has increased sharply and reached 115% of GDP. She is far from the only esteem the President of the ECB. "All the debts, of all sovereign states, have increased significantly because of the Covid because it was necessary to make the choice of the human rather than that of finance. According to Christine Lagarde, to bring it down and reimburse, "there are not 36 parameters when it comes to repaying a debt, which is a necessity." "If we have structural reforms and if we have support for growth that makes it possible to develop this element, we are able to change the direction of the debt and stabilize public finances, which is imperative."

Christine Lagarde finds it "a pity that the national debate has moved to Strasbourg"

Finally, when asked about Emmanuel Macron's speech yesterday before the European Parliament, "Unfortunately, I thought it looked a little more like the National Assembly than the European Parliament yesterday. I find it a bit unfortunate that the national debate moved to Strasbourg, a European city. I thought it was a bit sad."