Lagarde made the announcement at the end of a press conference held to explain the European Central Bank’s decision to hold interest rates, maintaining its key deposit rate at 2.5% despite inflation climbing to 3.8% last month, its highest since September 2023.
The early departure fires the starting gun on the race to replace her as ECB chief, at a time when the eurozone is struggling with weak growth and above-target inflation. The European Council, made up of EU heads of state, appoints the head of the ECB, which sets monetary policy across the eurozone.
Wearing two plasters on her face in her video message, which she attributed to a small surgery earlier in the week, Lagarde stated she no longer felt comfortable staying silent on broader global issues.
Christine Lagarde, the eurozone’s top central banker, has announced she is stepping down nine months early to speak her mind about world affairs and confront the misrepresentation of the truth.
To reassure markets and staff that her early departure would not disrupt the central bank’s operations, she added that a process has already started to identify her successor, noting there were plenty of excellent candidates.
Lagarde joined the ECB in late 2019, shortly before the start of the Covid pandemic, and noted that her early departure will also allow her to participate in next April’s elections.
“We have an obligation of neutrality; we comment on the situation with the focus on monetary policy,” Lagarde said, adding that the mandate was the price we pay for being independent. “But I feel that I should say those things and I cannot do so in my current position.”.