Interview with Christine Lagarde, President of the ECB, performed by Jean-Claude Bourbon and Marie Dancer on 16 and 28 September 2026
30 September 2026
You’ve got skilled all the most important crises: the monetary disaster of 2008 whenever you had been the French Minister of the Financial system, the Greek disaster and sovereign debt disaster in Europe whenever you had been head of the Worldwide Financial Fund, then later, as President of the ECB, the COVID-19 pandemic, the warfare in Ukraine and now the battle within the Center East. Has it develop into the traditional state of affairs for the world to be in a disaster scenario?
There have all the time been financial and monetary crises. What’s new is how they’re linked collectively. The pandemic gave rise to pressures on power and uncooked supplies, then got here the invasion of Ukraine which worsened the power disaster and the inflation surge. Crises not comply with one after the opposite, they’re interconnected and mutually reinforcing. That is an unprecedented actuality that we should now face.
In your opinion, what’s the most fast risk to the European economic system?
For the ECB, value stability stays the precedence. So the principle risk at the moment is the power disaster associated to the battle within the Center East. It’s clearly weighing on costs, but additionally on progress. The impact on financial exercise when the price of uncooked supplies rises is commonly neglected. And behind the power disaster there’s a geopolitical scenario present process main change.
Basically, the entire European financial mannequin has been shaken.
Sure. Europe has lengthy rested on three pillars: low cost power, notably from Russia, the big Chinese language marketplace for its exports and the US safety umbrella. These three pillars are being shaken at the moment. The availability of power from Russia has been lower off and China is now competing with Europeans in modern markets. Relating to the US safety umbrella, it has been solid into doubt, to say the least.
You’ve got been President of the ECB for seven years. What are you most happy with and what would you’ve finished in a different way?
I’m happy with our collective capability to answer extraordinary circumstances with extraordinary measures, all of the whereas preserving consensus. I’ve tried to incorporate everybody, to hearken to and respect completely different factors of view with, to place it merely, on the one hand the “doves” who favour low rates of interest to help financial exercise, and, then again, the “hawks” who name for greater charges to comprise inflation. We’ve discovered a method of working that enables for this range, in pursuit of the shared goal of sustaining value stability as stipulated by the Treaties, in addition to quick decision-making.
However we haven’t all the time obtained it fully proper. In 2021 specifically, we thought that the power shock can be short-term and subsequently wouldn’t require a direct response. Occasions proved us improper. We didn’t anticipate the way in which crises can be interconnected or, specifically, the massive surge in demand as we emerged from the pandemic, or the way in which through which the Russian regime deceitfully engineered the discount in fuel reserves.
At the beginning of your time period of workplace, you mentioned that you just had been neither a hawk nor a dove, however fairly an owl. Is that also the case?
Sure, deliberately. The owl is the image of Athena, representing intelligence and knowledge, however most of all, it’s my method of rejecting labels. I’m neither on the aspect of the hawks who favour tight financial coverage to struggle inflation nor on the aspect of the doves who’re eager to help financial exercise with accommodative financial coverage. I don’t take sides in financial coverage. I’m guided by information and ready to regulate when circumstances require it. In such an unsure world, dogmatism just isn’t a very good response.
The ECB raised its rates of interest in June and September. Aren’t you involved a couple of slowdown in financial exercise as inflation is basically resulting from issues past your management?
It’s true {that a} central financial institution can’t reopen the Strait of Hormuz or create new oil or fuel reserves. Our process is fairly to stop a provide shock – on this case the falling provide and growing price of power – from feeding by the economic system durably and driving up inflation. This may increasingly lead us to lift charges, on the threat of weighing on the financing of the economic system and consequently on progress. We’re effectively conscious of this and it’s why we glance very intently on the power of financial exercise earlier than performing.
Based on INSEE, the French statistical workplace, the French economic system is falling behind in contrast with the remainder of Europe. Is France the brand new “sick nation” of Europe?
I don’t need to touch upon the scenario of any particular person euro space nation particularly. Political uncertainty and funds deficits weigh on funding and exercise. We count on progress to be 0.9% within the euro space this yr, in contrast with 0.5% in France. The hole is evident. As well as, when your debt is near 120% of GDP and never on the right track to be introduced below management, it’s a critical matter. All of the extra so provided that governments are competing with sizeable personal financing wants, notably associated to synthetic intelligence. So which will improve the price of financing public debt.
That mentioned, it’s not 2008 or 2011. The European monetary system is far stronger. So I gained’t make any predictions. I’ve seen Greece, Portugal, Eire and Cyprus climate very painful crises, put their public funds again so as and restore confidence. These international locations have since returned to progress, usually at ranges above the common.
What classes can France draw from these examples?
The truth that there must be a reputable path, shared dedication and reforms to revive confidence. The executive and regulatory framework must be simplified, labour market reforms should be pursued and the problem of pensions must be addressed. As life expectancy rises, the pensions mannequin arrange prior to now can’t proceed indefinitely. We additionally must act on the European stage, specifically to deepen the capital markets union in order that European financial savings present extra financing for our funding.
Ought to there be taxes on these with the best wealth and on inheritances, as some in France recommend?
The funds of a authorities, a agency or a family has two columns: earnings and bills. So now we have to ask whether or not to give attention to one or the opposite, or on each, and which ought to take precedence, whereas taking account of effectiveness and proportionality. We additionally want to have a look at the extent of the tax burden in comparable international locations, as a result of you may’t preserve squeezing taxpayers. I’m reminded of the saying primarily based on Colbert’s remarks: taxation is like plucking a goose. You possibly can pluck and pluck and pluck, however there comes some extent when it’s not doable. Whenever you move sure thresholds, there’s a threat of diminishing returns.
Some individuals, like Jean-Luc Mélenchon, are calling for a part of France’s debt to be cancelled.
This could be technically unsure and financially very harmful. For those who resolve to not repay a few of your debt, why would buyers preserve lending to you? There’s a threat that they may cease lending or make you pay a lot greater rates of interest. France must preserve borrowing. And such a cancellation of debt would even be a violation of the European Treaties.
Do you propose to participate within the debates forward of the French presidential elections in 2027?
My process now could be to serve the European public curiosity.
And can you be a candidate?
That may not be a good suggestion in any respect. It’s not the identical job. First there’s a query of vitality, power and power. Then there is a component of inevitable sacrifice with this kind of dedication. And I’m 70 years previous.
In February this yr you hinted that you just may not keep till the tip of your time period of workplace in October 2027, a yr from now.
I don’t rule out the opportunity of leaving a couple of months earlier than the tip of my time period, however I haven’t introduced something particular and one factor is definite: I’ll nonetheless be right here in 2027. So if I go away early, it’ll solely be a matter of some months. It gained’t be world-changing.
Might your determination be influenced by the chance that the Rassemblement Nationwide occasion may win the French presidential election subsequent spring? For those who left early it could allow the present authorities to have a say concerning your successor, as an alternative of the brand new occasion taking energy.
It is going to be as much as the French Authorities in workplace when the time involves argue for its preferences and attain an settlement with the opposite leaders across the desk.
You had been the primary lady to function the French Minister of the Financial system, after which to guide the Worldwide Financial Fund and now the ECB. What would you say at the moment to a ten-year-old lady?
I might inform her to not shut any doorways. On the age of 23 I noticed myself working within the human sources division of an organization. However why human sources? and why only one firm? Luckily, some individuals advised me I may develop into a monetary analyst or a company lawyer. They broadened my concepts about what was doable for me.
For a very long time I assumed like William Faulkner that you just want “to dream excessive sufficient to not lose the dream”. However my view is extra nuanced as a result of on the age of ten you continue to don’t know your self effectively sufficient to know precisely what you need for your self. So I favor the concept you shouldn’t set limits for your self.
Whenever you had been a toddler, your mother and father welcomed Pierre Mendès France, Jacques Delors and different outstanding European figures into their dwelling. How did that setting of household, mental focus and religion form you?
At the moment I used to be a younger lady of ten. I helped serve the meals and was fully unaware of the function performed by these outstanding figures. However due to that household setting I used to be in a position to profit from nice confidence and love and, on the similar time, excessive requirements. It was additionally a really open household. My mother and father usually hosted friends – to not give trendy dinners, however to give attention to mental issues and questions of religion. My mother and father, and my father specifically, moved in a milieu influenced by humanism, the personalism of Emmanuel Mounier and the centre-left Catholic motion that sought to alter society whereas protecting to the ideas of the Gospel.
That humanist heritage appears to have disappeared from Europe now.
The rise of populism and violence is evident to see. However in Europe there may be additionally a resurgence of religion and a brand new power put into values of tolerance, respect and religion, which I didn’t expertise once I was in my twenties. A number of occasions that I’ve had the chance to attend have led me to suppose that – for instance, the go to of Pope Francis to Marseille three years in the past. Seeing the packed Vélodrome stadium and the zeal that led 60,000 individuals to fall silent in prayer… [silence] I can effectively consider that there could have been a component of fandom, however I feel it’s deeper than that. In my opinion, it’s a part of a renewal that we’re seeing.
Might this renewal be political within the broadest sense of the phrase, too? Does the Europe of Schuman and Delors nonetheless have one thing to say at the moment?
Sure, as a result of centripetal and centrifugal forces have all the time coexisted inside Europe. On the one hand, there are efforts to enlarge the European Union and provides it a political dimension, with a need to increase the circle of nations across the desk by admitting successively Moldova, Ukraine and a few Balkan international locations. Alternatively, there’s a clearly a way more nationalist motion in direction of turning inward inside borders.
And this populist wave is now affecting a number of of the EU’s founding international locations …
That’s true, however we should always by no means lose religion in individuals. Take a look at Poland: although the ultraconservative Regulation and Justice occasion had been in energy for eight years, Donald Tusk and his allies succeeded in forming a brand new majority in autumn 2023. And in Hungary, the place Viktor Orbán held sway for years, a change of presidency that many thought of unlikely finally took place.
So, I consider in a European bedrock of belief and collective ambition. However we have to bear one factor in thoughts: individually, EU international locations are too small relative to america, China or India. I noticed this first-hand as Minister, when negotiating on the World Commerce Group: you might characterize France, with its nuclear deterrent, however by yourself you carry no weight. However when Europeans communicate as one, they matter. Their voice is revered. As a result of there may be all the time a steadiness of energy at play.
The ECB has devoted appreciable consideration to climate-related points below your presidency, however some contend that this falls exterior the remit of a central financial institution …
I strongly disagree with this blinkered view. Local weather change has a direct affect on the economic system. For instance, a drought can disrupt navigation on the Rhine or the Saône and scale back financial output. How can we produce sound projections for costs and progress with out taking that into consideration? There’s additionally a monetary threat. The ECB holds belongings: if we disregard their publicity to local weather change, we fail to correctly assess the dangers on our personal steadiness sheet. And the identical goes for the banks we supervise. I’ve been dedicated to this trigger since 2011, once I joined the Worldwide Financial Fund.
How far can the ECB go?
We’re onboard for the inexperienced transition, however we aren’t within the driving seat. Local weather coverage is the duty of governments and parliaments. However that doesn’t stop us from being on the forefront of labor on this space. Our function is to include local weather threat into our evaluation and steadiness sheets, and to guarantee that banks do the identical.
The Pope has simply visited France. Can he nonetheless wield affect on the worldwide stage?
After all the Pope can wield affect on the worldwide stage. I very a lot admire the principled and steadfast stance he upheld when he got here below assault from President Trump.
What strikes you personally about Pope Leo XIV?
His encyclical letter Magnifica humanitas straight addressed the controversy on synthetic intelligence that’s unfolding at the moment. I hope this debate will transfer in the precise route, one which retains individuals on the centre of the system and avoids lowering work to an “accent” that may be changed by robots. The Pope stands squarely within the custom of Leo XIII’s encyclical Rerum Novarum, bringing the Church’s social doctrine into the age of synthetic intelligence. I very a lot hope that his voice will proceed to be heard and that he’ll additional develop his pondering on the problem.
What place does religion maintain in your individual life?
It’s basic. It’s a part of who I’m.
What did you’re taking from the Pope’s speech about Europe in Metz?
To begin with, Leo XIV’s exhortation “don’t be afraid of the longer term”. It echoes John Paul II’s “Don’t be afraid” within the circumstances we at the moment are dwelling in. Geopolitical tensions and even wars, synthetic intelligence and local weather change, to provide just some examples, are prone to be a supply of concern, particularly for younger individuals. We’ve to beat these fears. I may also keep in mind what Leo XIV mentioned about peace. The Pope’s presence within the land of Robert Schuman is a reminder that Europe isn’t just a geographical area or a market – it’s a group of values based notably on justice, dialogue and peace. We’ve had virtually 80 years of peace inside the borders of the Union because the Schuman Declaration of 9 Might 1950.
And on a extra private observe, what photographs and phrases from the Pope’s go to to France will stick with you?
What’s going to stick with me is the shifting and on the similar time spectacular sight of crowds that had been each reflective and joyful, joyful to be there and joyful to be collectively. There was a good-natured environment. Every thing was very effectively organised. I’ll keep in mind the quiet and heartfelt fervour of real communion.
Have been you touched that the Pope referred to his Norman roots?
Sure, after all. I really feel a deep sense of connection to Normandy. However I’m maybe much more moved by his dedication to these in want in Peru, the place he served as a missionary and a bishop. As Managing Director of the IMF, I visited the nation on a number of events. There I met individuals who left an enduring impression on me, for instance girls who confirmed extraordinary braveness and ingenuity to carry their households out of poverty and provides their youngsters a greater future.
Within the present circumstances, what issues you most and what offers you hope?
What issues me is the way in which the media and social media can act as a magnifying mirror for every part that’s going improper. Minor information tales develop into main occasions, whereas on a regular basis acts of solidarity and kindness stay invisible as a result of they don’t generate clicks or entice audiences.
However I by no means lose religion in individuals. I owe this conviction specifically to Robert Badinter. In 2003, in the course of the Iraq warfare, when France was seen very negatively in america, he got here to Chicago to talk about Victor Hugo. On the time, I used to be head of the legislation agency Baker McKenzie. I requested him about this hostility in direction of the French and he replied, “We must always by no means lose religion within the American individuals.” In his view, that they had one thing deeply good and stable at their core. These phrases have stayed with me. I firmly consider in societies’ capability to rediscover what unites them. However to try this, we’d like belief, respect and tolerance, together with a shared objective that brings us collectively.
Bringing everybody on board by dialogue and a extra inclusive strategy – isn’t that exactly what’s missing in France, given its very top-down establishments and the sidelining of middleman our bodies lately?
Change solely succeeds after we deliver all people on board. Everybody wants to know the shared objective and really feel that they’ve an element to play in it. That requires dialogue with unions, middleman our bodies and civil society. You can not deliver lasting change to an organization, an establishment or a rustic from the highest down: it’s essential construct help round a shared objective. It’s tough in France, however it’s important.
For those who had been to share with us one thing that belongs in your private pantheon, a murals, a spot, a movie or a e book, what wouldn’t it be?
A murals? Rachmaninoff’s Piano Concerto No 2, which for me is an absolute gem. It overflows with musicality, resonance and depth. This piece strikes a deep chord in me.
A spot? The Pays de Caux in Normandy. It’s the area in Normandy I really feel most deeply related to, the Normandy of my childhood, of Man de Maupassant and André Gide, whose writings stay with me to at the present time. That is the Pays de Caux that I like: wild and barely rugged, nonetheless retaining one thing of the late nineteenth century. It has nothing in frequent with the Normandy of immaculately manicured lawns and thatched cottages. My neighbours are cows and corn fields!
Poetry? Both Baudelaire’s Les Fleurs du mal or Jacques Prévert’s Paroles. For me, poetry is therapeutic. It’s a refuge.
