Lagarde: ECB will set rates where necessary, won't

Ai Huicha, August 28: The Federal Reserve and the European Central Bank are engaged in similar debates on whether to raise interest rates at their policy meetings next month, even as the U.S. economy has shown surprising resilience and Europe's economy appears to be headed for recession. Persistent inflation and uncertainty about how quickly it will subside are common challenges in both regions. Powell remained vague in his speech on whether the Fed would raise its benchmark interest rate again, but warned that "more evidence of sustained above-trend growth could put inflation at risk of moving higher and could justify further tightening." Monetary policy is sound." In her speech and subsequent interview, Lagarde discussed more broadly the new landscape facing ECB policymakers, characterized by new challenges brought about by historical change, including the energy transition and the fragmentation of global trade into competing geopolitical bloc. However, she also avoided talking about the decision in the coming months.