European Central Bank won’t overreact to fleeting inflation

FRANKFURT, Germany (AP) — European Central Bank head Christine Lagarde says Europe’s monetary authority isn’t about to “overreact” to temporary inflation by tightening policy. Lagarde said Tuesday that currently higher inflation of 3% in the eurozone is temporary, caused by bottlenecks and one-time factors. She said the bank still needs to nurture the ongoing recovery in the 19 countries that use the euro currency with stimulus including zero and negative interest rate benchmarks and bond purchases that drive down borrowing costs for companies. That sets the ECB apart from the U.S. Federal Reserve, which has indicated it is looking at scaling back its crisis bond purchases.