 Good morning, please pay attention to this bill and more Focus on the signature. It's a woman's signature the first woman's signature since 1998 to Christina guard being the only woman in a man's world and reaching the High-level positions is not an exception. That's the story of her life the president of the European Central Bank is not scared of challenges because Right now the eurozone is under difficulties She is in charge of over three hundred and forty million million people and she will be with us today It's Thursday. We are on the second of March and there are more pieces of news Today, so this is a summary of the mediator case, which is a corruption case going on in Spain at the moment I have nothing to hide whoever knows me and knows how sincere and honest I am Considered myself a victim. Do you feel abandoned by your party? Not by my roots colleagues, but by the party the head The high managers of the party. Yes So the socialist party is trying to stop the popular parties candle We are three months away from the elections and this case Is bringing up a lot of debate? It is more necessary than ever that we set up a research investigation that Decides which political responsibilities there are So he has been expelled from the party But she looked I was here with us yesterday and he provided More data about those people who went for a dinner in Ramses a restaurant in Madrid Do you know for a fact that they just went for dinner? Yes, in some cases. Yes. Okay. So in other cases, maybe not No, no, that's not what I said. Please. Don't misinterpret me I said that in some cases they didn't because that is the cases that we know for a fact that we spoke to them And we know that they went to dinner dinner full stop Ferro vial is Going to have its base in the Netherlands We will analyze what reasons there are for this flee Well, I totally reject this incorrect decision. I really don't share this decision Well, what the vice president should do is wonder if Did I do anything for them to stay? We will provide some data about unemployment. We have nearly three million unemployed people and there are two 100,000 positions that are still uncovered and why is that later? So now please We are going to be listening to madam Lagarde. She's already sitting with us on stage Christine Lagarde madam president welcome. Thank you for being here with us today From the institution that you chair the European Central Bank You have the challenge to try and bring down the inflation in the eurozone for 11 years You didn't raise up the money, but in only half a year the rates have had the greatest surge in history Let's look at the evolution Yes, a month ago the European Central Bank approved a new rate hike of 50 basis points That means that the money is at 3% in the eurozone and this is the fifth Consecutive hike. It's the fastest cycle in history. We can see the evolution here So we had a valley since 2016 rates had been at not percent But in July 2022 the curve started going up at an unprecedented rate And that is when the European Central Bank started Elevating the value of the money in order to stop inflation But our question is is this the end because the ECB is revising prices in March again Yes, and as an unprecedented gesture you anticipated that in the next March Meeting we will have a new hike of not point five percent Is this still the case has nothing changed? And it was surprising that you gave a heads up because that's not the norm. Is it well First of all, I think that there is every reason to believe that we will have another 50 percent 50 basis points hike At our next meeting in March and that is so because inflation is just way too high And we need to take all the necessary measures in order to bring inflation down This is necessary because the mission of the ECB is to maintain price stability Inflation is way too high. We need to look at what tools we have to bring it down and interest rates particularly for the short term is The most efficient tool that we can use so I cannot say yes for sure because it's a decision that is made by the governing council but we Have anticipated that this is very likely to be the case and I don't have any reason to believe that it will not be the case but We look at data we look at numbers We have had a few numbers recently. We are working on our projections Staff of the ECB will give us their projections going forward and we will to take all that into account But for the March decision, I don't have much doubt. Let's put it that way So can we think that there will be further hikes for the rest of the year because we have just Learned about the data for February in Spain and France and they are not very good We see that there's a rebound in inflation. So should we think that there would be further hikes later in the year? We said that we would be data dependent and I think that that's the most important Set of element That will determine our decision So we look at most recent numbers, of course, and yes, you're right. They've been on the upside in various countries and We look at our projections We look at the path ahead to see how much ground we have to cover and Then we make a decision so We shall see At this point in time, it's possible that we will continue on that path By which amount each and every Meeting it's impossible to say at this point in time There is a lot of guess estimates and some people say oh, it will be so much or it will be so much the real honest answer is that we will Be determined by data and we will decide when we when we see the data What is on the other hand very certain is that we will do whatever is needed In order to bring inflation back to 2% because this is what our mission is and this is what the people of Europe expect from us Bring inflation down to target, which is 2% I understand this is not an easy decision Sometimes we hear that there is a fight between Doves and and falcons those who are more in favor of mitigating these rate hikes and others who are in favor of applying More drastic measures aren't we risking? slowing down the economy in the whole euro area because Businesses and individuals will have trouble paying this such elevated risk, you know It is obvious that if you increase interest rates It is going to make financing cost for the banks higher They will themselves charge higher interest rates to their borrowers And that will have a dampening effect on demand But that's the tool that we have and that's the one that is going to be Demonstrating that it brings inflation and prices down the impact is on demand for sure It would by the way be also very helpful that any supply bottlenecks Any constraints on supply be removed as much as possible so that there is a good adjustment between supply and demand So what would be the cup is there a maximum that you are looking at? Because if we look at what the Federal Reserve are doing they talk about even 5.5 they are at 4% now, but is this the horizon that we're looking at I Think it would be a mistake to compare Europe and the United States The origin of inflation is different in the United States from what it is in Europe for us It was a combination of very prompt recovery after the terrible covid That we suffered and then it was the Ukraine in invasion by Russia this terrible And Unjustifiable event that took place a year ago So these two factors have been fueling inflation through the channel of energy prices and commodity prices So originally you have a combination of very fast recovery Rather compressed supply so the demand was strong but the supply was limited and then you had energy prices which were Nicely engineered by Putin in my humble view and fueled by the war in Ukraine So that's the European story in the United States. It's a different one. It's largely Fueled by a very very strong stimulus package that was put together Fiscal measures that were massive from Trump to Biden. There was a lot of stimulus and that obviously Heated the economy. There was very high demand addressed at a time when China was in the process of recovering and other countries Constrained their supply. So that's where it is Different story different tools different levels So I don't think that we can compare the two as if they were exactly the same What I know is that we need to go higher We need to be in restrictive territory and we need to stay there for long enough So that we are confident that inflation Returns sustainably to two percent. So it has to be higher and it has to be sustained for a period of time Exactly where I cannot tell you and there are multiple views again. We will be data dependent We will look at the impact that our measures are having and And we will we will stay there so that you know, we make sure it remains on target It's not just a little Blip and then back up again. No, we don't want that So for the time being Madam Lagarde, we have seen that Those hikes impact the euro board and the prices but not on inflation because it hasn't gone down But we're going to go around Spain so that citizens can ask questions themselves In Galicia Julia Hector are 30 years old. They have just had a child and they want to buy their home but they cannot afford to We would love to buy a house. Yes, of course, can we afford it? Well, unfortunately, no We would like to know when can we do it? When will the interest rates go down so that we can have access to a house of our own? We can see that this rate hikes has a direct impact on the euro board, which is the more case Reference rate and that's where citizens and families are seeing the highest impact, especially if they want to have a variable rate More cage. Yes, many more people are suffering financial stress in February Euroboard was at three point fifty three percent, which is the highest since November 2018 and we have been seeing 14 months of increase in a row in February 2022 euro board was in negative points minus 33 and in just over one year There's an increase of nearly four points. So Spanish People who have a variable mortgage will see the impact for a hundred and fifty thousand euro mortgage in 25 years the difference is of 300 euros a month, but let's say that we have a higher mortgage 300,000 well the increases of 600 per month it's Over 7,000 euros per year more Yes, so people who have to use six years worth of their salary to buy a home So what's going to happen with the Euroboard Madame Lagarde because some people have said that Some people believe that it can reach four or five percent in the summer First of all, I'd like to congratulate the young couple that just had a baby. I think that's a wonderful sign of hope and and You're a mother. I'm a mother and it changes your life and you look at okay, where shall we live? What car can we can we drive? and and so on and so forth what I would like to say is that Interest rates will not return to where it was two three four five years ago when interest rate was actually negative okay, Euroboard was negative and Obviously as a result of the change of situation that I tried to explain where inflation went up We need to use interest rates in order to tame inflation and make sure that it returns to two percent So our the projection of our staff at the ECB at the moment tells us that ECB that inflation will return close to two percent in 25 two percent is a very decent inflation rate and I'm determined to bring it back to that at which point When we are confident that it will stay there Interest rates will begin going down. So interest rates are not high forever Once we stabilize the situation once inflation is back to two percent once prices are stable again in grocery shops in when you buy things Then interest rates will go down. But you see what I understand from the Spanish market is that currently There are fewer people who take Adjustable rates people tend to go for fixed rates In order to lock in the rates that they will pay and to have some certainty about the future Those who took adjustable rates had the benefit for many years of very very low interest rates Now of course because you take the good with the rough You had the good because it was low and now because interest rates have to go up to tame inflation Interest rates are higher. So I know it is tough For some people and I know that mortgage Rates for some are difficult. I also know that some Spanish banks in particular are opened to renegotiation of the terms of the mortgages and I think that people who are Indated who have a mortgage should explore with the banks whether there are options in order to avoid falling into You know a difficult point where the loan is not performing anymore The house that is at risk of being attached and foreclosed which which is terrible It's true that the change of the mortgage changes have been So much higher than in last year and then we have a good practice code Promoted by the government that met most banks have adhere to it, but there are many Obstacles to it and not so many people can can do it. I would like to Ask you about what Podemos the partner in government because they accuse you to do Monetary terrorism and they're asking for caps in mortgages. What do you have to say about that? Well, I'm not a terrorist that's for sure and I'm guided by public interest and by the mission that was given to the ECB under the Treaty of Europe And our mission is to return price to target and to maintain price stability We are the custodian of the euro Cap on mortgages, it's not something that the central bank can decide. This is not our mission. This is not our It's it's impossible to do that. It would be you know something that regulators can decide at the national level and Or it's something that can be negotiated with banks, but it's not for the European Central Bank to do that Can you confirm that delay in payments have skyrocketed or that banks are not giving so many mortgages due to risk of default There has been a reduction in the volume of loans that have been asked by Families and there has been a reduction of loans that have been asked by companies So I think that the price of money having increased people think okay I'm not borrowing now. I Try to use my savings or I try to organize myself differently But this is intended You know, we need to dump and demand. We need to weigh on You know the cost of financing so that we have reduced Demand on the part of both families and corporates. So in that way You would say that our monetary policy is actually transmitting to to the economy via the banks This is what happens in Europe. We are predominantly financing the economy through banks. So we hiked interest rates Money is more expensive for banks They make it more expensive to families and corporates when they land to families and corporates But they should also not forget to remunerate deposits Yes, we will talk about that because that is not being fulfilled only a few banks are remunerating a bit more the assets and in the deposits but We're seeing That the ECB took a long time in raising interest rates, they were kept at zero for many years So the feeling is that when you decided to react and to bring them up The progression has been incredible in just over six months. Do you regret taking so long to react? You know inflation started being really noticeable in July of 21 and at that time most economists said Transitory temporary we will see through this because it comes from the supply. It's a supply shock It's a tax from the outside if you will and it will go away. It will be absorbed and it will it will be transitory it was not transitory and it lasted Much longer it transmitted to the economy and we decided at the end of 21 that is in Sorry, I'm getting my numbers mixed up. It's it's at the end of 20 It's at the end of 21. Yeah that we that we started Normalizing our monetary policy So what we did is in December 21 We announced that we were going to Reduce and then stop the purchase of assets that we were going to reduce and stop the emergency program that we had put in place in order to fight Covid and bring enough liquidity to the economy and support the economy and it's in June 22 that we then decided having stopped purchases that we decided to hike interest rates And we did so as of July and consistently and at the very high pace. You're right And and heard of before in Europe. Could we have started? Three to six months earlier possibly would it have made a huge difference. I don't think so So it would have been better to start earlier Do I have regrets I'm looking at what comes next I'm looking at the future I'm looking at how we can improve the situation and bring inflation back to target. That's what I'm most focused on now In spite of all these rate hikes over the past six months We can see that inflation is is wild. We were told that prices would moderate in 2023, but that's not the case Today we're going to find out the latest available piece of data, but in January the CPI was at eight point six percent That means that prices were moderated we can see it on the curve because inflation goes down not point six percent Back to December levels and we are seeing three months in a row where inflation prices go down It's the lowest level in the eurozone since July 2022 if we compare it With the average of the eurozone. It's been holds a good position The harmonized index is at five point nine percent together with Luxembourg at five point eight percent Luxembourg is the eurozone country with the lowest rate, but what is the greatest concern the underlying? Inflation there's no truth. There's a new record at five point three percent. That is an Old-time high Yes, so let's go back to the street in Sevilla. She's a housewife. She has four children She's 67 years old and she says that she has to Be really creative with a shopping basket. I used to like coming to the market But now is a nightmare until when are we going to see prices going up? Are we ever going back to prices before the crisis? So madam Lagarde For how much longer will prices still go up? When will we peak? What's your forecast first of all? I would observe that inflation has Lowered and gone down in the last three months It's gone up a little bit in February by the way. Okay, so it's not Stable declining. It's it's it's a directional decline, but it it is not steady In particular the price of food is increasing at the moment. What we will see in March is Numbers that will go down much more so than we have simply because of base effects I told you earlier on that the price of energy hiked Significantly as a result of the Ukraine invasion by Russia and that was 24th of February last year so we will have base effects for the March numbers and We are confident that it will then continue to go down but it is still just way too high as Mentioned 8.6 is way too high for the eurozone and The ECB has to continue to take action in order to reduce inflation, you know I when I come back in one year's time I don't want this this lady to Still be angry and I understand why she's angry. I understand that prices are up And when I do my own shopping, I can see that myself So my hope is that we we can bring it down As rapidly as we can but it's going to take a while because it has you know sort of invaded The whole economy. It's a bit like a poison Inflation it penetrates through a part of your body and then it gently quietly or not so quietly at all Invades the whole body. We need to tame that we need to stop it Okay, so I'll keep the two reflections that for one year Prices will start go down and also that you will be back next year with us in order to confirm that But I'm sure that you worried about the underlying as you said, it's like a poison an invisible poison that it's attacking Economy that's seven point seven of the underlying inflation in Spain is the highest Figures since there are records. Yeah, and just just for your Your watchers to understand what we call the the core inflation is a whole basket of prices excluding energy excluding Unprocessed food all the rest is in that core inflation and as I told you The original inflation that was driven partly by the strong recovery against constrained supply Plus the energy that fueled it that does sort of trickled and invaded All of the goods and the services what I'm really concerned about is the service sector Because that is the one that is predominantly You know our economies. We still have some industry. We have Goods determining portion of the basket But services are the predominant part and generally services are labor intensive and that takes us in the direction of wages and How wages and how labor costs are going to evolve in the near future? Yes, we will be talking about wages as well because they're not matching inflation Except for the case of pensions in Spain But we can't see that the measures adopted by the government are working. They lowered the VAT in some Food, what do you think about this? Discount in VAT, you know, I was Minister of Finance for my country in France for four years and I know that Reducing VAT is one of the easiest most convenient tool to use in order to reduce prices But it has two drawbacks One is it benefits everyone whether you are rich or poor whichever car you're driving whichever house you live in You're going to have the benefit of reduced VAT This should not be the intention of governments in Europe at the moment Okay It should be targeted. It should be the measures the fiscal space the other the tax payers money that is put out For good work to the economy should go to the most exposed people to the most vulnerable people. Okay The second drawback of this VAT measures is that at some point you need to bring them back up so you you Zero them or you reduce them But you need to come back to those previous rates because you need to fill in the coffers of of the state You need to have the revenue at the time when you bring it back up Then that has an inflation on prices and that determines yet again A hike in in prices so this I Understand why it is done, but it's not it's not the ideal tool. I have to say I think that Spain does Another as another benefit for those people who earn less than 27,000 euros per year They get a special stipend of 200 that that is much more targeted that is in our view You know a better use of Benefits at the moment Yes, but that is a one-off payment and requirements are Strict in order to be able to to get that I Won't ask you about the Podemos option of Subsidizing the shopping basket just like we did with oil fuel for cars. So I will say that question. Okay However, I do have a question for you Regarding wages because when we go out in Madrid we see Alfredo his 57 years He has contributed for many decades, but his salary is not matching the price search I Only got a 10 euro Increase in my payroll. I can't make ends meet. So madam laggard Until when are we going to have to live in this situation? situation so When will wages go up because the ECB has always requested moderation in wages increase, but in Spain the minimum wage has Reason nearly 8% but regular wages have not only at 2.7% Yeah, my understanding that it is that in Spain minimum wages has gone up by 8% and pensions have also gone up Right so in a way that that is that is very targeted to those who have minimum income And although it fuels demand, it's it's clearly targeted You know what we are observing in many Countries of the euro area is that unions Workers employees are putting pressure on companies and employers to say look inflation is up Prices are up The business is still going reasonably well at the company level There is a good reason to sit at the table and to negotiate How we are going to cope with the situation and I think that this is a desirable outcome not to go into you know a dangerous spin of Prices up wages up prices up and so on and so forth that the economy the economy is called the second round effect We we we should as much as possible stay away from that because otherwise we will have to tighten Monetary policy even more than than we should but catch up closes reasonable Negotiated arrangement in order to increase salaries is something that we observe in many many European countries And I hope that it can happen in Spain as well I Understand that especially in Spain the purchasing power has been reduced much more than in our neighboring countries So from your words, I understand that you are critical with this hike in pensions of 8.4 Because because beyond being an electoral measure it brings more inflation Well the three criterias that we have for benefits and for measures and for special programs are temporary Targeted and tailored Temporary because we are dealing with a situation that hopefully is not going to last and that therefore those measures should be Relief released and and and waived when the situation improves. That's number one number two targeted at those people who are Most exposed and vulnerable. I think that pensioners with low pensions and minimum wages Employees are falling in that category and tailored because you don't want to Disincentivize people from saving energy So, you know in that respect, I think that the those measures that you've described that I don't know the details of Satisfies some of the criteria Well, some of our journalists colleagues have questions for you. So Paco Marueta. He's the director of Larazón and newspaper. What's your question? Good morning, Madame Lagarde. It's a pleasure to be here with you today This is an inflation crisis It's a crisis that you have to Cold the economy but there are some interesting questions around Until when do you think you can keep the situation of not accepting the spending rule to allow Overspending all economic crisis has costs, but the costs right now Are being suffered by workers because salaries are not going up and Well, the government has risen everything. So when you say that the crisis has a Horizon and end, but how can that be if the war in Ukraine has not finishing? Horizon and it can become another North Korea, you know I think you you are right to refer to the war in Ukraine as the big Uncertainty and the big cloud over our European economies and we are much more exposed and much more at risk than for instance The US economy that's another big difference that we have with the US economy First of all, I think just like you my hope is that this war will finish that Blood will stop shedding and that there will be a negotiated settlement and peace Negotiated between the parties, but we can leave in hope We don't know whether that will happen or not in the meantime. I think that what we have seen is an incredible resilience of Europe in general of enterprises and consumers and Employees all of us we have been employees all of us. We have been incredibly resilient in the face of this of this Situation if you look at at just Europe, you know First of all, we decided to close racks and be together So the next generation you the resilience and recovery fund of which Spain is a great beneficiary and after the war started The determination to just stop getting oil and gas from Russia and to turn to alternative suppliers to negotiate with Norway with Algeria with some of the Middle East countries and to benefit from the unfortunate climate change Driven warm winter that we have experienced except in Madrid in those days But so all of that has you know Brought the Europeans together and I think has showed resilience at a point that you know We had not anticipated we thought that the economy would be down that we would be negative territory in the fourth quarter of 22 we were not it was not brilliant, but we were not in recession and The projection that we have for 23 is that it will come back and activity will return to more positive territory if you look at enterprises, they've also been incredibly focused and resilient and I hope that you know when people look at numbers and look at how The fruits of those efforts are allocated. There is a good and sensible Allocation between the various factors of production We're going to talk a little bit about yourself and about your life your French woman His that her dad was an English teacher and her mom Greek Latin literature and when your father passes away you decide to go abroad I've heard that Your parents supported you a lot that they made you become very autonomous and you Achieved many things. Let's get to know you a bit better We could say that her DNA matches leadership because she's been a pioneer in many aspects To start with her personal life She is the eldest of four siblings and she was born on the first of the first 1956 in Paris When she was 16 her father died her mom's courage To bring them forward had an impact on her life. She was a fan of sports She joined some French teams. She studied in France and in the United States in this private school for ladies She got a scholarship and a few years back. She goes back as a alumni She had a brilliant career as a lawyer in Chicago and she was the first woman chairing this law firm and From that moment onwards, she would be the first in many other situations She was the first woman to lead the monetary portfolio and Then she's the first woman running the International Monetary Fund She's a fighter with a very bright humor. She's a woman in a world of men her Interest in gender equality has been very seen Forbes considers her to be one of the most influential Person she was the first woman to run the ECB and the first lady to sign our bills she's close and Show solidarity She had to fight a sanitary and an economic virus is both and then the war in Ukraine She has two children and she says that sports Taught her to pick her battles inflation is her last fight in spite of all the challenges in This 67 years we can see that she always has a smile on her face I dare to say That there was tears too. Was it emotional when you saw your family there? Well, it's always moving when you see family members and You know my father died when I was 16. So when I see him. Yeah. Oh my god all the brothers Yeah Well childhood is where you belong ultimately Yes, that's right childhood You are there's four of you in your family. We can't meet all of them But one of them is here with us today. What I Have to say he has a different surname because Lagarde is the surname of your first husband and the father to her children Good morning. He's an engineer and entrepreneur. He plays volleyball at professional level and we Would like him to describe Christine. How are you doing? We're great. Look, what was Christine like when she was a Girl what what she want to become when she grew Oh dear, what is he going to say? I was probably less serious than I was more Involved in practicing sport And for example, I was practicing my smash and my Inside the house we were living and she was very upset with that and And unfortunately She was asking our mother to take my volleyball ball and To hide it and it prevents me. It has prevented me to become Fantastic I Apologies, look, I understand that when you were young or not so young when you were teenagers You were quite rebel She was an activist she participated in many in many struggles Yeah Christine was about 15 I was about 13 and at that time we were very Involved in politics That was due to our parents one more time When we were having lunch or dinner, we were listening to the radio and we were listening to politics and we were very much involved and It happened quite a few times that we have participated to demonstrations in the streets And Christine and myself we were Fighting against And I guess at that time that I understand it did because she studied law and politics Beyond her career in economy, of course Would you like to say hello to him? I'm sure that you want to say hello or you can speak French if you wish As as you prefer you can talk to your brother. Salut mon grand tu vas bien je vois que tu as très sérieux building derrière toi et t'as pas un Trude golf ça m'étonne Golf Quel chance Merci beaucoup d'avoir participé merci Thank you so much. Look, it's been a pleasure having you too So I would like to ask you about your family side some people think how a woman like Christine Has worked like balance. How did she manage to do it? Do you have any tips for us? Amalia has five years. She's a manager in a chemical sector company and she has a question madame lagarde I believe that in Spain. We're taking little measures to strive work like Balance there are not many nursery schools working hours are long The maternity leave is not that great So what's your opinion about Spain in terms of work life balance and what could your opinion institutions do to help us? First of all, I think that it's extremely important and it's a priority that women be given Equal opportunity equal chance be remunerated equally when they do the same job as men. This is not the case yet OECD average difference between men and women's pay for the same job is still north of 10 percent And sometimes close to 20 percent in some countries. So I think that's an absolutely critical Objective to have and I would say, you know, I as head of the IMF I visited many many developing countries many emerging markets And I think what is fundamental for all of us is to make sure that girls get the same education have the same Equity available so that they can develop into what they want to be they can they may want to be a mother Others might want to be an executive like the woman that we heard on on on the show But they should be given those opportunities not the case not the case still today and I speak from experience I have lived in a world of man, which is fine Nothing wrong with that But women must be given the same equity and the same access as as men So back to the very practical question that was asked what needs to be done in addition to education Obviously public infrastructure and available Kindergarten places where parents can actually and trust their children for a period of time when they go to work that that is critically important second Make sure that the the work that needs to be done at home is Properly shared it is still the case today that women in addition to the job that they eventually have do most of the work at home This is not right those tasks have to be shared It's not for the mother to raise the children and to look after the house and for the man to go and do other things One of my pride I have to tell you you know my children are now You know over 35 and and and big boys and they have their life and their children One of my pride is that they know not just how to put a wash on but they know how to iron their shirt I've always you know decided that my sons would not be asking their wives to do that and It's a tip, you know, it's very anecdotal, but that's what I mean equal education equity available access and available infrastructure for both parents and Parents in the house sharing the tasks and I tell you if that is available women thrive They are amazing You are amazing Thank you so much madam president. We wanted to ask this question We are only one week away from the 8th of March the day of the women and one last question We're running out of time but isabel the director of expansion expansion the newspaper has another question Congratulations madame lagarde for your amazing professional career and also personal because Central bankers have a heart too. I would like to ask you about the Spanish economic situation. What do you see in terms of? Employment and growth we get this question very often as economic journalist and how Is that within the European? Framework and another question is if you have discarded the fact that there will be a recession in Europe You know when when I look at the numbers of the various member states, I can see that Spain is doing Better than others whether you look at GDP whether you look at inflation. It's better unemployment No, there is more unemployed people in Spain than in other countries and that has been I mean You know Spain much better than I do but it has been the case historically for long periods of time And I guess the you know coming out of the great financial crisis has taken time Getting back to the pre-covid situation is not done yet So the situation in terms of GDP numbers and inflation is better But Spain has not yet covered the ground to return to the COVID-19 a point or the COVID Sorry pre-covid 19 point and pre-covid 19 trajectories So there is still much work to to be done on Employment and unemployment. I think that we need to really understand who is who is actually working because there are quite a few unemployment schemes that are in place furlough schemes and who actually Produces in the economy is is something that needs to be really clarified Are we going to have a recession in 23? Based on our staff projection No, and for the overall euro area. I'm not talking about one particular country But for the overall euro area, we don't see a recession We may have you know a technical recession for some countries You know two two quarters in a row that are negative It certainly might be the case for Sweden There might be a couple of other countries that are at that risk, but the overall euro area is projected to be in positive territory We have reasons to believe that Spain will also be in the same situation So no no recession on the horizon of our staff projections and an improvement of the situation over the course of 23. Yes Hopefully let's hope that's the case We are in Madrid because we have a guest with a special interest She wanted to ask you about the high salaries in some sectors We said that salaries in Spain grew up very little By comparison with inflation. Yes, her name is Estela Martinez. She's 24 years old She works as a croupier in an online casino and she earns 1200 euros and she is renting a flat as many other people. I Would like to know how is it possible that big companies management? Earn incredible bonuses when the middle class is getting poorer by the day. Thank you I'm not sure that a central banker can actually Do something about that. It's not the mission of central bankers and the question that you ask has to do with the way in which Value is distributed around societies. That's a societal choice And it's it's not something that a central banker can determine My hope is that you can make more money, of course because to cope with inflation higher wages within reason or Would be a good thing You have also criticized bonuses with some bankers too and you also claimed that savings was also remunerated And now I take the opportunity to ask these questions Why do banks provide so little interest to those who have their money in their banks? I think that's a very good question and And and one that consumers clients of the banks should address head-on with their bankers You know we discussed interest rate hikes The price of money has gone up the price of Borrowing has gone up for both banks and their clients but if you deposit your savings and if you are prepared for instance to leave it for a period of time then Negotiations should start between the client and the banker in order to have your savings actually remunerated and This is happening in quite a few countries. I know that this is an issue in Spain and I very much hope that Consumers will actually have those discussions. You know when when I was a student. I was I was a very much Supporting the movement of consumers consumers associations I think that the the the relationship have Relationships have to be discussed in a concerted way in the current situation obviously Banks clients have to take up this discussion with bankers and bankers have to be sensible about it if they want to keep their clients I think the alternative is Change bank and there are quite a few countries where the Switching from one bank to the other has been facilitated. This has certainly been the case in my country and I did that when I was finance minister Okay, we take good note of this piece of advice as president of the European Central Bank because you know a little bit What you're talking about banks go you know out of business and that they reduce their capital and then they stop complying They have to comply with the rules. They have to be sensible They have to care for the business of course because they are part of the solutions that we found in the last couple of years No question about that, but when interest rates are hiked in the way they are and have to be then there has to be that discussion Madam president you were saying that energy prices would moderate In this winter the gas prices were high even though it was a warm mild winter Actually the main Responsible for that hike in Spain But we have a question from a lorry driver who is asking what's going to happen with fuels with petrol When will the price of fuel go down because we've been losing money for a long time now Do you believe that once the Ukrainian war is over we will be able to recover? You know Also about the heating invoices Electricity bills, yeah If you look if you look at wholesale prices Whether it's the price of fuel oil or the price of gas it has gone massively down Compare with one year ago. That's what I call the base effects if we compare the price Next March with the price of March a year ago. They will be a significant difference that there is what Economist would call a lag lagging a lag time. There's a period of time between the wholesale prices the Channel through the retail prices and the impact on the consumers We are seeing that and I have no doubt in my mind that both in terms of Fuel at the tank or or gas or electricity. We will see prices coming down Will the war in Ukraine be a relief it will be a relief for the Ukrainians first of all it will be a relief for peace in the world and and we hope so and and I Hope so very very much and we do everything we can to participate in that but will we return to the same? Sources of supply. I don't think so I think we are learning a lesson and we should not forget it and we should have security of supply diversity of supply proximity of supply which I think will will completely change the map of our sourcing Particularly in terms of energy, but not only in terms of energy And finally this is a question at national level well probably you saw it because on the press It's everywhere. Ferrovial has decided to change their professional domicile to the Netherlands and There is it it wasn't very well taken in the reason they say is that they're looking for Legal security and better prices, but a better tax regimes What do you have to say about that because in a European zone where supposedly in terms of taxes There should be harmony, you know I don't want to comment on the specific case of a company because I'm not familiar enough with with that But I would observe two things one is There is a corporate world. There is a private sector which is organized by the rules that we have In the corporate world shareholders decide That's one point Second point is that this whole story Convinces me even more that we have to fight for capital market union What do large companies want at the moment? They want to extend their market share They want to diversify their market share. They want to have access to deep and liquid Capital this is not the case in Europe. I'm sorry to say we have a fragmented market There's a stock market in Madrid. There's a stock market in Paris. There's one in Frankfurt Do they work well together? Does the corporate world have access to deep and and liquid finance? No, do they have to file multiple prospectus when they go public in different places? Yes Do they have to use different languages? Yes. Do they have different legal framework within which to operate? Yes, do they have different bankruptcy law within which to operate? Yes, and do they have different tax rules? Yes, I think on all those points tax bankruptcy Single filing point of access. We are making progress, but not fast enough I dream of this day when we have this consolidated Coordinated well synchronized capital market union where companies like Ferovial or others will say I'm fine I'm going to access a deep capital market in Madrid Paris or Frankfurt. I'm governed by the same set of rules I have a guaranteed framework within which I can operate and if I need to get access to the US market I'll do a do a listing one in Europe one in New York But I don't have to move necessarily because we are much better unionized. We have monetary union We can have capital markets union So I'll keep the fight that was very clear. Yes yet another fight I'm asking Carlos Rodriguez our graphologist and analysis about your signature. He has been studying your signature and According to what you write on our bills He would like to describe what your personality is like Carlos. Go ahead Well, it's a signature that is very easily a readable. We can see the confident She brings more importance to her surname. So that's her professional side, but in Terms of emotions. She has a lot of self-control. She prioritizes thinking over Feeling but at the same time, she's easy-going So she has a self-control a great power of will a fighting attitude towards life And she's a ball because intellectually she's a logical person Who can chain ideas together? With easy decision-making capacity And she's a constant person In terms of social relationships She needs contact, but at the same time she's quite selective. So not everyone can do She might be a bit Lacking trust in some situations, but she is always a polite Hard-working and kind with others. Well, I think this is enough, right? Do you agree Christine? Do you feel do you does it resonate with what you think? I think you're very flattering. So I will take all that for me It's good you go food. Thank you Thank you so much for being here with us today is the first interview that you give in Spanish TV We were delayed delighted to have you here and we have learned so much with you We hope to see you here next year, and I hope that your forecast come to come to Reality so hopefully in March Thank you so much Christine Lagarde Right, so we're moving on to the mediator case