Lagarde Cites High Uncertainty, Restates ECB Hiking Plan

ECB President Christine Lagarde testified to European lawmakers, indicating that while a recession is not the baseline, an economic slowdown is expected. She discussed the ECB's new spread control tool, emphasizing its effectiveness and alignment with their mandate. Lagarde reiterated the ECB's commitment to a 25 basis point interest rate hike, despite larger hikes from other central banks, and hinted at a potential 50 basis point hike in September. The ECB aims to proceed cautiously, monitoring market reactions while sticking to its plans.

What are the current conditions for the economy according to the text?

What did ECB President Christine Lagarde indicate about the recession?

What are the potential conditions for the ECB's new spread tool?

What is the ECB's approach to interest rate hikes as mentioned in the text?

How does Lagarde's statement reflect the ECB's commitment to its plans despite market moves?