The woman who calls herself Europe’s “Mrs. Crisis” is approaching the final stretch of her career with the world barely recognizable from the one she once knew.
Two decades since first entering public service, President Christine Lagarde of the European Central Bank can take heart from an outlook for stable inflation, coupled with some resilience in economic growth. But the rise of populism, and the continent’s struggles to navigate global power politics, weigh on her mind.
Those are some of the insights Lagarde offered in an interview for the Bloomberg Originals series Leaders with Francine Lacqua. Sitting on the 39th-floor of her institution’s building in Frankfurt, she described how inequality is fueling support for political extremes, while slow decision-making is hampering Europe’s ability to forge its own destiny.
“We will live in a world which is more volatile, which is more prone to shocks, and which has clearly fragmented under our eyes,” Lagarde said in the conversation recorded in November. “I hope we come to a moment of reckoning.”
New World Order
The race to lead the ECB is already under way, even though a lot can still happen before the president’s retirement next year. However that pans out, the Frenchwoman, who turned 70 last week, can already see how the emerging contours of a world redrawn by US President Donald Trump and his country’s arch-rival, China, will challenge her successor.
Since re-entering the White House last year, Trump has ordered military attacks on seven sovereign nations and pushed to rewire trade in America’s favor. China has stepped up aggressively to expand its own economic influence. For all the European Union’s attempts to respond — including roadmaps to raise competitiveness, and a drive to rearm — the bloc remains mired in bureaucracy and discord.
The ECB sees inaction as a threat to business investment and consumer spending, undermining hard-fought gains from stabilizing inflation at 2% after a once-in-a-generation price shock and a decade-long deflation scare. Sensing the urgency, Lagarde has stepped up demands for change, seeking more reforms, faster decisions and greater unity.
“There is a momentum that has built over the course of the last year in particular, and President Trump has triggered that — so, thank you,” she said in the interview, which didn’t address future monetary policy. “Europe is learning those lessons. Is it learning fast enough? Future will tell.”
Lagarde pledged to keep shaping that future until October 2027, despite prior speculation of an early exit to run the World Economic Forum.
“I’m not a quitter, no — because when you have a mission, you have an objective, you just have to deliver,” she said, while acknowledging the ECB role turned out to require more time than expected.
“I was always under the impression that it was a five-year term,” Lagarde said. Had she known it lasted eight years when first accepting, “I would have given it a longer thought.”
The ECB chief also insisted she’s not interested in returning to French politics and making a bid in presidential elections due in just 15 months.
“I don’t think so,” Lagarde said. “I’ve seen presidents come and go, and I’ve seen them age and change, and it’s past my bedtime.”
That said, it’s clear that the kind of rifts dividing France, with tensions festering between rich and poor, and a prospective victory for the populist National Rally, is focusing her thoughts.
“We cannot function with societies that are deeply divided, and where a large majority feels left out,” Lagarde said.
The ECB chief also spoke about threats to central-bank independence, at a time when Trump has repeatedly criticized the US Federal Reserve and its chairman, Jerome Powell. Lagarde treasures the autonomy of her institution, adding that it’s something that policymakers have to earn.
“I have never received a phone call from any of the leaders in Europe, because they know that they cannot do it — it’s in the treaty,” she said. “I don’t think that it is as strongly established from a legal point of view for the United States, or for the UK, or for other countries.”
With an end to her time in office coming into view, Lagarde can look back on a high-profile career punctuated by turmoil. She joined France’s government in 2005, and then became finance minister just before the Global Financial Crisis hit. From 2011, she led the International Monetary Fund during Europe’s sovereign-debt woes before joining the ECB, where the pandemic then hit.
“I’m Mrs. Crisis,” is how Lagarde described herself, while insisting she’s not easily flustered.
“In times like that, I generally stay calm,” she said. “It’s not that I enjoy crisis” but “I do enjoy this difference between the excitement, the fear, the anxiety, and the fact that you can sort of draw on your own strength, on your resources, on your breathing, to actually bring about some calm.”
Disclaimer: This report is auto generated from the Bloomberg news service. ThePrint holds no responsibility for its content.
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