Christine Lagarde Says Euro Area Economy Is Holding Up as Digital Euro Plans Move Ahead

ECB President Christine Lagarde said the 3.8% inflation rate recorded in September mostly came from high energy costs, which the bank expects to ease next year. Speaking at the IMF Annual Meetings on Saturday, she said the energy shock will likely keep inflation above target through the first half of 2027, but a measured policy response is still appropriate.

Digital Euro Plans

Lagarde said the ECB is preparing a digital euro to sit alongside cash for everyday payments. She argued it will boost innovation and competition in retail payments while public and private options continue to coexist, supporting Europe’s strategic autonomy.

Pontes Settlement System

The ECB also launched Pontes on Sept. 21, letting institutions settle wholesale tokenized asset deals in central bank money instead of private assets like stablecoins. Full rollout is expected by 2028.