Washington (United States) (AFP) – European Central Bank chief Christine Lagarde said Tuesday she would not leave her post early as the global economy faces a severe storm, insisting: “This captain is not going to leave the ship.” Media reports emerged earlier this year that Lagarde may step down before the end of her term in October 2027, claims she had already sought to downplay.
But, with the eurozone being hit hard by the Iran war energy shock, she issued a firmer denial in an interview on the sidelines of the IMF and World Bank spring meetings in Washington. “When there (are) big clouds on the horizon, the captain does not leave the ship,” she told Bloomberg TV. “And this captain is not going to leave the ship.”
“When you see major disruptions, the energy supply being reduced, when you see threats to growth, upside risks to inflation — these are serious matters that we have to be attentive to,” she said. The Financial Times previously reported that by departing early, Lagarde would give the French and German leaders a chance to determine her replacement ahead of French elections. France’s far-right, eurosceptic National Rally (RN) is seen as having a chance of winning power in the polls.
The outbreak of the US-Israeli war against Iran has sent oil and gas prices soaring, a major burden for the eurozone as it relies on energy imports, and economists have downgraded their growth forecasts for the region. Analysts have raised their bets on the ECB hiking interest rates as soon as this month to keep inflation in check, although Lagarde would not be drawn on what decision the central bank might make.
She also welcomed the victory in Hungary’s weekend elections of pro-European politician Peter Magyar, who defeated nationalist leader Viktor Orban, and signs he is keen on Hungary adopting the euro. “I’m delighted that he’s looking at it with a very positive approach,” Lagarde said, while stressing that the process of joining the single currency could take some time.
© 2024 AFP
