ECB bid to diverge from Fed pits Lagarde against tide of history

By Craig Stirling, Greg Ritchie and Naomi Tajitsu

04 May 2023 · 3 min read

Editor's Note

Christine Lagarde has shown that the ECB is in no mood to pause its interest-rate increases—unlike the Federal Reserve. But past experience suggests any divergence won’t last, Bloomberg argues.

The European Central Bank's newfound status as the standard-bearer of monetary tightening sets up President Christine Lagarde for a tussle with investors doubting how long the euro zone can plow its own course.

Hours after the Federal Reserve's hint on a possible halt to interest-rate hikes, she insisted the Frankfurt institution is in no mood to pause - a stance already being tested by traders betting no one can sustainably defy the gravitational pull of U.S. policy.

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