Lagarde says in Davos that inflation is still too high

The president of the European Central Bank (ECB)Christine Lagarde, has warned this Thursday in the Davos World Economic Forum about the inflationwhich continues to be “too high” despite the decline experienced in recent months, which practically makes it possible to rule out a recession.

Lagarde has regretted that many journalists “they emphasize too much in their headlines that inflation has gone down”despite the fact that it is still at very high levels, which is why the body that presides “maintains its mandate to place it at 2%”.

In Europe, the subject of the debate in which the European Commissioner for Trade, Valdis Dombrovskis, and the Dutch Prime Minister, Mark Rutte, have also participated, Lagarde has indicated that the activity “it is falling compared to 2022″ but it’s better than expected.

It is possible to be more optimistic, he said, although the ECB “He is concerned about inflation and also the labor market”which, however, is in one of the most “dynamic” of recent times with very reasonable unemployment rates.

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For Dombrovskis, the way to boost growth in Europe is to implement strong fiscal policies and reduce deficits. At a time when “the star” are the economic reactivation plans, it must be taken into account that “70% of the measures are approved without knowing exactly what their destination is”.

The Trade Commissioner has indicated that “energy prices are subsidized” and good results have been achieved, while investments for the green transition have accelerated, but we must think about the immediate future.

Europe has been able to do that because “It had its tanks full of gas, Russian among others, something that will not be possible next winter”So you will have to look for other providers.

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The Dutch prime minister, for his part, has focused on aid for the lowest incomes, which cannot be maintained in the long term because the funds are going to “subsidize the energy of the most disadvantaged families” and they stop investing in education or innovation.

Likewise, it has also questioned the payment of pensions “in countries like France or Italy”which in the same way prevent certain resources from being allocated to more profitable games in the long term.

Source: EFE