ECB’s Lagarde sticks to benign view of inflation

Euro zone wage demands remain modest enough to support the European Central Bank’s expectation for inflation to decline this year from its current record high, ECB President Christine Lagarde said on Friday.

Speaking to a World Economic Forum panel, Lagarde said that energy prices are expected to stabilize in 2022 and industrial bottlenecks, which have also pushed up prices, could also ease.

Euro zone inflation hit 5% in December, more than twice the ECB’s 2% target but the bank sees it back below 2% by the fourth quarter.