Lagarde warns ECB may do more to rates than remove stimulus

DAVID McHUGH
AP Business Writer

FRANKFURT, Germany (AP) — The president of the European Central Bank is warning the bank may have to raise interest rates beyond merely withdrawing stimulus and into territory that could restrain growth. In a speech at a banking forum in Frankfurt, Germany, Christine Lagarde said Friday that the ECB expects “to raise rates further, and withdrawing accommodation may not be enough.” The bank is fighting to control record inflation in the 19 countries that use the euro. The ECB has raised rates at the fastest pace in its history to combat inflation that hit 10.7% in the eurozone in October. Lagarde cautioned governments against excessive spending on support for consumers and businesses hit by high energy costs.