FRANKFURT—The European Central Bank will continue to lag behind the Federal Reserve in tightening monetary policy despite rising inflation, ECB President Christine Lagarde said on Thursday, helping to drive the euro to a near five-year low against the dollar.
Ms. Lagarde’s comments, which came despite increasingly clear signs that the war in Ukraine is pushing already high fuel and food prices even higher, also weighed on short-dated eurozone government bond yields as investors pared back expectations that the ECB will aggressively lift interest rates.
