Rate hikes “are just starting to work, for example the new data” on inflation “in Italy say we are at 6.9%”, but “core inflation is still too high, in Italy it has gone from 5, 6% to 5.7% so there is still work to do”: said the president of the ECB Christine Lagarde during the meeting with 400 students promoted by the Osservatorio Permanente Giovani-Editori chaired by Andrea Ceccherini. However, Lagarde underlined that “there is a lot of uncertainty”, therefore the ECB will evaluate the data at each meeting.
“I would not put Deutsche Bank and Credit Suisse in the same category,” said the ECB president. Lagarde reiterated that the ECB will ensure that banks have access to all the liquidity they need, because “there is no trade-off between financial stability and price stability”.
This period of “permacrisis”, i.e. a series of unprecedented shocks, shouldn’t make us pessimistic, Lagarde said during a meeting with 400 students. This period “took us from the illusion that we could have cheap energy, health and control of our own destiny, to resilience. Should we be pessimistic? No, because when we look at what we have been able to do based on resilience it is extraordinary”, said Lagarde, recalling that the EU remained united with the war, “we decided to be on the side of those who suffered the invasion”, and for vaccines “everyone believed that the Europeans would do it alone but then we organized ourselves and we collaborated together and reacted, something that we never imagined.”
“The ambitious but very clear objective is to bring inflation back to 2%”, and “there is nothing that will make us change the objective because it is of critical importance. Of course we have to follow what happens at a political level but the Bank central is independent, works under mandate and will carry out its task, added Lagarde.
It is “hardly likely that a Silicon Valley Bank case will repeat itself in the EU, because “the system is very robust”, and we do not have banks “with the same concentration as the Svb, i.e. an exclusive sector of venture capitalists which has left many deposits policyholders in this bank and within a very short time he decided to take them off,” said Lagarde. “In the US there were about 13 or 14 controlled banks and they have to comply with capital requirements and have enough liquidity if something happens. In the EU there are many more, there are about 2000 for which we do stress tests and verify that they have sufficient capital. It makes a big difference,” he explained.
Read the full article on ANSA.it