Cutting interest rates too soon in Europe risks progress against inflation, central bank chief says

By DAVID McHUGH
AP Businss Writer

FRANKFURT, Germany (AP) — European Central Bank head Christine Lagarde says cutting interest rates too soon could threaten Europe’s progress in battling the inflation that has ravaged the economy. Lagarde is faced with market expectations for rate cuts as soon as March or April. But she underlined the bank’s intent to keep its benchmark rate at a record high for “as long as necessary” until it’s clear that inflation is back at the goal of 2%. Speaking at a Bloomberg News event during the World Economic Forum’s annual meeting in Davos, Switzerland, she acknowledged concerns the bank had gone too high too fast with borrowing costs.