Lagarde today took a quite clear stance on the issue of stagflation.

On April 30th, the President of the ECB spoke to the media after monetary policy decisions, and clearly indicated that the term stagflation should not be used to describe what is happening now in the Eurozone.

The topic is interesting because it touches a sensitive nerve.
Lagarde today emphasizes that the combination of inflationary risks and weak growth is not even remotely comparable to the conditions of the 1970s.
I know many use the term stagflation to talk about the current situation, and I understand why it causes anxiety, but in her view, the term should remain associated with that specific period.

What strikes me is how both Powell and Lagarde today agree on this point.
Powell said something similar last month, describing the 1970s as a "much more severe" situation.
Lagarde went further, emphasizing that the current situation is "completely different."
In the 1970s, inflation was persistent and stable, unemployment was at record highs, and the monetary and fiscal frameworks were very different from today.

Lagarde also reiterates that the ECB's framework is solid and that they have the necessary determination to bring inflation back to 2%.
This is a stark contrast to the 1970s, when no one could control inflation.
In short, the message is clear: today’s problems are real, but they are not the same as those of the past.