Lagarde: inflation will stay high, ECB course toward a hike is unchanged

What Lagarde said. A Yomiuri Shimbun reporter recorded the interview on November 4, and the ECB posted the full text on November 7. The key line: "We know that inflation numbers will remain high in the quarters to come. The higher they are, and the longer they remain high, the greater the risk to our medium-term target." The ECB target is 2%.

On December. Asked whether the ECB should hike before second-round effects show up, Lagarde said it decides by the data, meeting by meeting. "I cannot tell you today that we will for sure do this in December. What I know is that, on the basis of the information we have today, it would take significant changes for the direction of travel to be different from what I expect." She said this matches her October 29 press conference.

Where inflation comes from. Lagarde broke down October's 4%: energy is up 20.8%, driven by the Middle East conflict and less global refinery capacity. Core inflation, without energy, food, alcohol and tobacco, held at 2.5%, services at 3.3%. The ECB sees no wage spiral beyond its forecast: it watches multi-year wage deals and companies' wage expectations.

On forecasts and debt. Since the September projections, energy futures and long-term interest rates have risen, and the new forecast will take that in. She linked higher long-term rates partly to heavy borrowing by governments and by big AI companies building data centres. She told high-debt countries, France included, to follow the fiscal rules. On the TPI crisis tool, she said no tool is ruled out in advance.

On herself. Lagarde leaves the ECB in February 2027. She does not plan to run for French president, but wants to speak up in the debate. Chairing the World Economic Forum is one of the options, she said, nothing is decided.

What we do not know. Whether the ECB hikes on December 17 and by how much. What the new forecast shows. Whether full data on November 18 confirms the flash inflation estimate.

Confirmed facts

• On November 7, 2026 the ECB published Christine Lagarde's interview with Yomiuri Shimbun, recorded on November 4.^[1]
• Lagarde: "inflation numbers will remain high in the quarters to come", and the longer they stay high, the bigger the risk to the medium-term target.^[1][2]
• Lagarde did not promise a December hike, but said it would take significant changes for the course to differ from what she expects.^[1][3]
• The ECB sees no second-round effects beyond those already in its projections.^[1][2]
• October inflation was 4%, energy up 20.8%, core 2.5%, services 3.3%.^[1]
• In late October the ECB held its deposit rate at 2.50%.^[3]
• Lagarde does not plan to run for French president and called chairing the WEF one of the options.^[1]

Implications

• ConfirmedThe ECB president openly kept a December hike on the table.
• Our readingA December hike looks likely unless the data changes. This is our reading, not an ECB decision.
• Our readingEuro loans may get pricier and savings rates may rise slightly. This is our reading.

Still unknown

• Whether the ECB hikes on December 17, and by how much
• What the new ECB forecast shows for inflation and growth
• How long energy prices stay high

Who it affects

Euro area. People in the euro area, borrowers, savers and anyone holding euros

Sources

1. European Central Bank: Interview with Yomiuri Shimbun November 7, 2026 · official
2. Bloomberg: ECB's Lagarde Says Inflation Likely to Stay High in Near Future November 7, 2026 · media
3. Investing.com: ECB's Lagarde says inflation to stay high, sees little reason to alter rate course November 7, 2026 · media