FRANKFURT—The European Central Bank must keep raising interest rates to fight off inflation, even if the probability of a eurozone recession has increased, ECB President Christine Lagarde said in an interview published on Tuesday.
“Our mandate is price stability and we have to deliver on that using all the tools we have available,” Lagarde told Latvian news outlet Delfi, largely repeating last week’s policy message. “We are determined to do what is necessary to bring inflation back to our 2 percent target.”
The ECB has raised interest rates by a combined 200 basis points over the past three meetings, and markets are pricing in a string of further moves that would take the 1.5 percent deposit rate close to 3 percent in 2023….