In a post published yesterday, I looked at how different energy price paths could affect inflation in the euro area and the case for ECB policy action. President Lagarde’s speech at the ECB Watchers conference last week adds an important signal. She indicated that a rate increase could come as soon as the 30 April meeting. That is a warning that should be heeded. Central banks always stress their readiness to act. But Lagarde went further and explained why early action might be warranted. She emphasised that policy should focus on risks to the outlook, not only the baseline. Those risks are tilted to the upside. The ... (full story)