By David Barwick – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde said Thursday the ECB would make every effort to ensure that inflation returned to its 2% medium-term target.

“We will make every effort to ensure that inflation is at the 2% target in the medium term,” Lagarde said in an interview, according to German public broadcaster ZDF’s dubbing of her remarks. “We are doing everything necessary to achieve that outcome.”

The comments followed the ECB Governing Council’s decision earlier Thursday to raise the deposit rate by 25bp to 2.50%.

“We cannot reopen the Strait of Hormuz,” Lagarde said. The ECB, regardless of how powerful it was, could not do so, but could try to mitigate the consequences of the closure, she said. “And that’s what we’re doing.”

Lagarde said the ECB was drawing lessons from the last major inflation shock: “We know what happened in 2022. We know how quickly it happened."

"It will therefore get worse before it gets better," she said. "But it will get better.”

“Political stability is important. Uncertainty is difficult to handle,” Lagarde said, adding that Europe was currently surrounded by uncertainty originating both within and outside the region.

Lagarde again evaded questions concerning her professional future, offering no further indication of whether she intended to leave the ECB before her term expires.