ECB, Lagarde: “We are monitoring the euro–dollar exchange rate, it is important for growth and inflation”

Frankfurt (Germany), Feb. 5 (LaPresse) – “With regard to the exchange rate, I reiterate that we do not have an exchange-rate target as part of our monetary policy objective. But we also acknowledge that it is important both for growth and for inflation prospects. For this reason, we always closely monitor exchange-rate developments, and the Governing Council discussed this today,” said ECB President Christine Lagarde at a press conference in Frankfurt. “Now, what we have collectively observed is that the dollar has depreciated significantly against the euro, but not in recent days. Rather, it has been since March 2025 that the significant change has been observed. And in recent weeks—indeed since the summer—it has fluctuated within a range. And whether one considers the euro–dollar rate or the nominal effective exchange rate, the picture is the same. Therefore, as a result of this observation, we concluded that the impact of the exchange-rate appreciation since last year is incorporated into our baseline scenario,” Lagarde added, reiterating that “of course, as I said, we always monitor whether the impact is materializing as expected and how it affects our reaction function. This is the analysis we conducted. So it is a topic we addressed, which we explored. I would also note that the current range within which the euro is evolving against the dollar is very much in line with the overall average of that euro–dollar exchange rate, or since the euro has existed.”