IMF Managing Director Christine Lagarde said ECB has a “broad tool kit at its disposal and must stand ready to act.” She added “while I do not believe that the ECB has hit the effective lower bound on policy rates, it is clear that low rates have implications for the banking sector and financial stability more generally.”
Lagarde is expected to take over Mario Draghi as next ECB President on November 1. Her comments came as written answers to the European Parliament’s committee on economic affairs.
