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HomeLatest NewsLagarde (ECB) trusts that the banks will increase the remuneration of deposits

Lagarde (ECB) trusts that the banks will increase the remuneration of deposits

Date: March 24, 2023 Time: 03:18:37

The president of the European Central Bank (ECB), Christine Lagarde, hopes that banks will begin to reflect the rise in interest rates in all their products, including also the deposits of their clients. To date, entities have barely made a move in this regard, opting instead for target return funds, a situation that has given rise to a fever for Treasury Bills and other alternatives.

“We want our interest increases to be transferred to the financial sector, including banks. deposits”, Lagarde stressed in an interview with ‘The Economic Times’, in which he reiterated his intention to continue raising rates to contain inflation.

As for the ECB’s monetary policy, the French company recalled that the institution has warned rates since last July at an unprecedented rate and size and has reiterated that more increases will be carried out if necessary to return inflation to the 2% goal in a timely manner.

“It will take what it will take. What I know is that we are going to return inflation to 2%. And we want not only to return it to 2%, but to keep it there in a sustainable manner,” he said, noting that interest rates are the most efficient under current circumstances. As for the fiscal response, Lagarde has insisted that governments ensure that their support measures are temporary and direct their support to the people who need it most. “Temporary, specific and personalized. Those are the three key principles”, she has summarized.

This change has made it possible to moderate the growth of inflation in the euro area for the third consecutive month to 8.6%, its lowest level since June of last year, just before the turn of the rudder in monetary policy began. With this, the rise in prices is contained from the 9.2% average that it reached in December among the countries that share a currency, although core inflation (which excludes its calculation of more volatile components such as energy or fresh food) marks a new record high at 5.3%, which gives more arguments to the entity led by Christine Lagarde to continue with its restrictive monetary policy.

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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