Write to us

Email*

Message*

Send

27 October 2023

Economics

Europe

A failure of a currency – Lagarde keeps interest rates at 4,5% and threatens future hikes: “The euro area economy remains weak”. After years of QE, inflation is now the natural enemy, and it’s here to stay. Disparities between European countries are growing, while the leading economies have been infected as well

Source: Reuters

The European Central Bank left interest rates unchanged as expected on Thursday, snapping an unprecedented streak of 10 consecutive rate hikes, and maintained its guidance which signals steady policy ahead.

Following are highlights of ECB President Christine Lagarde's comments at a news conference after the policy meeting, which was held in Athens.

ECONOMY TO REMAIN WEAK

"The economy is likely to remain weak for the remainder of this year. But as inflation falls further, household real incomes recover and the demand for euro area exports picks up, the economy should strengthen over the coming years."

DOWNSIDE GROWTH RISKS

"The risks to economic growth remain tilted to the downside."

PRICE PRESSURES

"Domestic price pressures are still strong."

SERVICES WEAKENING

"The services sector is also weakening further. But this is mainly because weaker industrial activity is spilling over to other areas."

ECONOMY WEAK

"The euro area economy remains weak."

Weekly most viewed

Lady Ursula’s plan for European rearmament is the usual German delaying tactic: each state will put up the money for itself, a little from the EIB, a little from some other fund with a fancy name, and then we’ll see who survives. Of course, even with the separation of military spending from that great idiocy called ‘Stability and Growth Pact’, the heavily indebted states won’t be able to do much more than they’ve been doing. Nobody is talking about serious matters: if we really want Europe to become a credible political subject, we have to start by changing the treaties in a framework that includes the United Kingdom

The Qatargate had dissolved in a soap bubble also due to the lack of credibility of the Prosecutor who originally dealt with the case. But there’s nothing to be done, the trawling starts again: accusations are once again being made against two Italian S&D MEPs. S&D is the group that most often uses moralism for political ends and that has been intransigent in the reform of the Parliament, limiting the freedom of mandate of European MEPs and turning them into a kind of automaton. The problem is the separation of legislative and judicial powers. In these times of chaos, it should be pointed out to the European left that in the race to be the purest, there is always someone purer who will purge you

More articles

12 February 2025

The EPP is waiting for the vote in Germany and the subsequent formation of a government to see how to proceed. The Stockholm Declaration only talks about security and other agreeable issues, without any reference to green policies or immigration. Not to mention economic policy. Yesterday, during the vote in Strasbourg on the annual report on the ECB, an issue came to the fore that is common to almost all political parties (S&D, Renew, EPP, ECR, etc.), namely the differences between frugal and pro-European states on EU economic policy. In fact, even in the EPP, some MEPs abstained on amendments proposed by the Left, which rightly pointed out the dysfunctionality of a system that has a common monetary policy without a common fiscal and industrial policy, and also criticized the ECB for its too rigid interest rate policy.