The day after the assembly of the European Central Financial institution (ECB), Thursday, June 9, a cartoon within the German day by day Handelsblatt confirmed Christine Lagarde desperately making an attempt to shut the door on a flood of water symbolizing inflation. The toes of the President of the ECB had been on a European carpet which was progressively slipping away.
With inflation within the euro zone at 8.1% and rates of interest hovering on the monetary markets, Mme Lagarde might be having her hardest second since taking up as head of the ECB in November 2019. “She is taking part in her mandate proper now, relying on how she comes out of this disaster”believes Ludovic Subran, chief economist of Allianz. “It is his stress take a look at” (referring to the “stress exams” that the ECB makes banks cross to measure their soundness), provides Aurore Lalucq, MEP (Place Publique), member of the committee on financial and financial affairs and who, as such, auditions Mme Lagarde a number of occasions a yr.
When the Frenchwoman arrived at her publish, the very masculine microcosm of central bankers questioned: right here is somebody who was not from the seraglio, not an economist by coaching and who was to switch Mario Draghi, a a lot admired technician. Would she be as much as it?
“Maintain a type of consensus”
An unlucky sentence, pronounced in March 2020, in the course of the outbreak of the Covid-19 pandemic, bolstered doubts: “We’re not right here to scale back the “spreads” [l’écart entre le taux allemand et les taux des pays périphériques] », she stated then. Listening to this, the markets had panicked, imagining that this indicated that the ECB may probably let go – within the occasion of a disaster – of a susceptible nation, akin to Italy.
Two years later, Mr.me Lagarde has as an alternative gained favor with observers. “We’re not on the identical political facet, however we should acknowledge that his scenario could be very sophisticated. I used to be afraid she was not ingenious sufficient, however she launched the asset buy plan in the course of the pandemic, and she or he superior on the greening of financial coverage”, reduction Mme Lalucq, “I’d somewhat be benevolent, provides Eric Dor, from Ieseg, a enterprise faculty. She collects crises [pandémie, puis flambée d’inflation]. She was chosen for her skills as a diplomat, to carry collectively the members of the ECB. »
The Board of Governors, made up of twenty-five members, is certainly very disparate, between hawks and doves. “The problem for her is to keep up a type of consensus, and she or he does that very nicely, notes Mr. Subran. The issue shouldn’t be Christine Lagarde, however the present financial scenario. »