TL;DR
Get business pricing on office and shipping supplies
- Business-only prices and quantity discounts
- Tax-exempt purchasing
- Multiple users, one account, clear invoices
ECB President Christine Lagarde told the IMF’s International Monetary and Financial Committee that the global economy and euro area had shown resilience, but the Middle East conflict and energy-price swings posed risks to growth and inflation. She cited euro area inflation of 3.8% in September and said the ECB had raised rates by 25 basis points in both June and September.
European Central Bank President Christine Lagarde told the IMF’s International Monetary and Financial Committee on 17 October that the euro area had remained resilient despite geopolitical and energy-market shocks, while warning that higher energy prices were pushing inflation up and risks to the outlook remained. Her statement set out the ECB’s latest projections and explained its 25-basis-point rate increases in June and September.
Lagarde said euro area growth was broad-based across most countries and sectors in the first half of 2026. The ECB staff projections published in September forecast growth of 0.9% in 2026, 1.4% in 2027 and 1.5% in 2028. The bank expects domestic demand to benefit over time from recovering real incomes as energy inflation eases, alongside government spending on infrastructure and defence and investment in artificial intelligence and digital technology.
Inflation moved higher: headline inflation reached 3.8% in September, driven mainly by energy and, to a lesser extent, food and services. Core inflation rose slightly to 2.5%, while the ECB’s range of underlying inflation measures remained broadly stable. Lagarde said wages had not yet shown a material response to the energy shock.
The ECB expects higher energy prices to keep headline inflation well above its target into the first half of 2027, before it declines and returns to around target toward the end of that year. Lagarde said the Governing Council’s September rate increase followed a rise of the same size in June. Future decisions, she said, would depend on incoming data, underlying inflation and how strongly monetary policy is affecting the economy.
Energy Shock Shapes ECB Policy
The statement links geopolitical developments and energy prices directly to the euro area’s inflation outlook and the ECB’s policy choices. If the energy shock lasts or spreads into wages and other prices, inflation could prove more persistent than the bank currently projects. That would complicate the balance between containing price pressures and sustaining economic activity.
For households and businesses, the outlook matters because energy costs influence living expenses, production costs and financing conditions. Lagarde said long-term interest rates had risen notably since the ECB’s previous meeting, tightening financing conditions. She said that tightening could slow growth and reduce the pass-through of energy costs more than expected in the September projections.
Her remarks do not announce a new rate decision. They explain the reasoning behind the recent increases and signal that the ECB intends to respond to evidence as it arrives, rather than commit in advance to a fixed path. The distinction matters for borrowers, investors and governments watching both price trends and the cost of credit.
As an affiliate, we earn on qualifying purchases.
September Projections and Rate Moves
Lagarde delivered the statement at the 54th meeting of the IMFC, during the IMF Annual Meetings. The committee is the IMF’s principal advisory body on international monetary and financial issues. Her remarks represented the ECB’s assessment of the economic outlook, rather than a new decision by the committee or a separate ECB policy announcement.
The ECB’s September staff projections provide the forecast baseline cited in the statement. Since then, the Governing Council has raised its key interest rates by 25 basis points in June and another 25 in September. Lagarde described the response to the energy shock as measured, saying the shock was too large to ignore while the ECB continued to weigh inflation risks against growth and financial conditions.
She also pointed to longer-term policy priorities: sound public finances, investment in technology and infrastructure, and reforms that help workers acquire skills and innovative businesses grow across the EU Single Market. These points broaden the statement beyond interest rates, but do not change the ECB’s immediate focus on inflation data and monetary-policy transmission.
“The global economy has proven surprisingly resilient in the face of high uncertainty.”
— Christine Lagarde, ECB president, in her IMFC statement
As an affiliate, we earn on qualifying purchases.
Energy Prices and Inflation Risks
The statement does not establish how long or how intensely the Middle East conflict will affect energy markets, or how far those effects will spread through the economy. Lagarde said a more intense or persistent shock could strengthen indirect effects and second-round price increases. The timing and scale of any such pass-through remain uncertain.
The inflation and growth figures for 2027 and 2028 are projections, not outcomes. The ECB said risks to growth were tilted to the downside and risks to inflation to the upside. It also identified factors that could lower inflation, including weaker energy-cost pass-through, more risk-averse financial markets or a sustainable resolution of geopolitical conflicts.
The statement gives no future schedule or threshold for ECB rate decisions. It also does not quantify the economic effect of the conflict, the energy shock or the rise in long-term rates. Those questions depend on developments and data that were not settled in the statement.
As an affiliate, we earn on qualifying purchases.
Incoming Data Will Guide Rates
The ECB’s next policy decisions will be based on incoming economic and financial data, the inflation outlook and risks around it, underlying inflation dynamics, and the strength of monetary-policy transmission. Lagarde said the Governing Council would make a comprehensive assessment under its reaction function, rather than specify a predetermined rate path.
Investors and policymakers will be watching energy prices, headline and core inflation, wage trends, growth and financing conditions for signs that the shock is spreading or easing. The next policy decision and updated data will clarify whether the September projections remain a useful guide; the statement itself does not say when or by how much rates may change again.
As an affiliate, we earn on qualifying purchases.
Key Questions
What did Christine Lagarde tell the IMFC?
She said the global and euro area economies had shown resilience but faced risks from geopolitical tensions and energy prices. She also reviewed the ECB’s inflation outlook and recent rate increases.
What was euro area inflation in September 2026?
Lagarde’s statement put headline inflation at 3.8% and core inflation at 2.5% in September. The ECB said energy was the main driver of the headline increase.
Did Lagarde announce a new ECB rate increase?
No. The statement described rate increases of 25 basis points in June and September and explained how the ECB would assess future decisions. It did not announce another increase.
What does the ECB expect for euro area growth?
The September ECB staff projections forecast growth of 0.9% in 2026, 1.4% in 2027 and 1.5% in 2028. These are projections, not confirmed results.
When does the ECB expect inflation to return to around target?
The statement said headline inflation was expected to decline after the first quarter of 2027 and return to around target toward the end of 2027. The path depends in part on energy prices and how their effects spread.
Source: primary
Halloween Picks
halloween
As an affiliate, we earn on qualifying purchases.
