ECB President Lagarde (Q&A) says risks of second-round effects is something we have paid attention to

• We pay attention to both direct and indirect effects, and the secondary effects
• ECB currently not seeing risk of second-round effects in addition to what is already in the economic projections
• Do not see risks of material second-round effects at the moment

Second-round effects have been the ECB's central hawkish anchor through the post-pandemic inflation cycle: the argument that initial price shocks feed into wage settlements and then into broader price-setting has historically been the justification for keeping policy restrictive longer than headline disinflation alone would warrant. A sitting president stating publicly that no material second-round effects are visible beyond what is already embedded in staff projections is the soft version of that anchor, and on previous occasions this kind of language has marked the stage of the cycle where the governing council's focus shifts from inflation persistence risk toward the timing of easing. The qualifier matters: the baseline is said to already carry some pass-through, so the signal is that the tail risk is fading, not that the transmission has stopped. As Q&A commentary rather than a prepared statement, the remarks sit one rung below formal communication in weight, and front-end repricing on single-speaker answers of this kind has tended to be modest unless the tone is echoed across the council. The sensitivity now concentrates on the data the ECB itself treats as second-round proxies: negotiated wage settlements, unit labour costs, and services inflation, where releases have moved the curve more than headline prints in comparable phases. The follow-on tell is whether other council members adopt the same formulation or preserve the more cautious framing, since it is the centre of the council rather than any one voice that sets the path.