European Central Bank President Christine Lagarde said policy makers will set interest rates as high as needed — and leave them there for as long as necessary — to bring inflation down to target in the 20-nation eurozone.
Speaking at the Kansas City Federal Reserve’s annual symposium in Jackson Hole, Wyo., Lagarde said global central banks are operating in a new and uncertain environment that requires the rewriting of the monetary policy playbook.
“Policy-making in an age of shifts and breaks requires an open mind and a willingness to adjust our analytical frameworks in real-time to new developments. At the same time, in this era of uncertainty, it is even more important that central banks provide a nominal anchor for the economy and ensure price stability in line with their respective mandates,” Lagarde said in prepared remarks.
“In the current environment, this means — for the ECB — setting interest rates at sufficiently restrictive levels for as long as necessary to achieve a timely return of inflation to our 2% medium-term target,” Lagarde said.
The euro
EURUSD,
See also: Fed’s Powell unsure of the need to raise interest rates further
