The European Central Bank must think hard about how it deals with risks and uncertainty in an era of more-volatile inflation and less clarity about monetary-policy transmission, President Christine Lagarde said.

Profound shifts in the world economy could make inflation volatile for years to come, complicating efforts to control prices, but sticking with inflation-targeting regimes is still the best option, European Central Bank President Christine Lagarde said on Friday.

ECB President Christine Lagarde praised the "remarkable" unwinding of inflation with minimal job losses, projecting inflation to hit target by 2025. However, she warned that significant uncertainties remain.

Policymakers are lowering rates and signalling new confidence that a ‘soft landing’ is possible. But few are ready to declare victory

The European Central Bank lowered its 2024 economic growth projection on Thursday but still sees inflation broadly in line with its 2% target by the end of 2025.