ECB President’s speech at the European Parliament’s economic committee hearing

Christine Lagarde, President of the European Central Bank (ECB), delivered a speech at the hearing of the Committee on Economic and Monetary Affairs of the European Parliament.

She highlighted that this week marks four years since Russia’s aggression against Ukraine, expressing solidarity with Ukraine and those affected by the war.

Lagarde discussed the challenging environment in the euro area, with high inflation impacting households and firms. She noted that inflation has decreased from a peak of 10.6% in October 2022 to 1.7% in January 2026, attributing this to the ECB’s monetary policy measures.

Despite the decline, surveys indicate that many citizens perceive prices to be rising faster than official data show. The divergence between actual and perceived inflation influences economic behavior, expectations, and trust in institutions.

Lagarde explained that perceptions are shaped by personal experiences, demographic factors, and psychological biases, such as focusing more on price increases. Food inflation, which has been above overall inflation since mid-2022, significantly influences perceptions.

To address this divergence, the ECB emphasizes maintaining its inflation target, improving communication, and investing in financial literacy. The ECB has enhanced its outreach through digital platforms and educational initiatives.

She concluded by stressing the importance of trust between the ECB and the public, and the role of policymakers and the public in reinforcing the legitimacy of the euro.

For more details, visit the original source: ECB Press Release.