ECB’s Lagarde: We’re getting very close to reaching our inflation goal

• We’re getting very close to the stage to declare that we have sustainably brought inflation to 2%
• Still should be very vigilant about services inflation, which is hovering around 4%
• Some underlying inflation figures are moving in the right downward direction
• Price levels are not going to return to the good old ways
• Puzzled by this impression people have that they don’t have as much disposable income
• Need to be vigilant on wages as well
• We’re coming close to the end of that process where wages have caught up with prices
• Hopefully we don’t return to the very counterintuitive system of negative interest rates
• Tit-for-tat retaliation on trade is just bad for the global economy at large
• It could also turn out to be bad for the US economy, for that matter
• Full transcript

Just some overview remarks there by Lagarde but her acknowledgement of the disinflation process just means that they’re positioning themselves to keep cutting rates going into next year.

This article was written by Justin Low at www.forexlive.com.