ECB’s Lagarde: European Economy to Benefit from Olympic Games

29 July 2024

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Monday said that the Olympic Games could be beneficial to the European economy at large as they would add to activity, consumption and confidence.

In an interview with CNBC in Paris, Lagarde said that there were at least three different channels through which the Olympics could contribute to the economy:

‘One is if you look around at Paris for the last three or four years, there has been enormous construction sites, work, infrastructure being developed, transportation extended. So that has brought about some additional activity, and it is going to be conducive to more activity, better housing and development’, she said. ‘The second one is if you look around, there is a lot of consumption going on at the moment, people are buying, people are exporting and a lot of people are coming to visit, so that's again another channel. And I think the third one is confidence.’

Confidence was key to reducing economic uncertainty, which was currently a concern, she said.

 ‘[T]ypically large sport events bring about that added confidence that we so much need at the moment. How much exactly? It's hard to say’, she said.

The impact of Olympic Games could only be assessed with certainty ‘ex-post’, she said, though recent French data might be connected to the games.

‘If I take the example of France, when we look at services, the service PMI has gone up for the first time last month’, she said. ‘Whether or not it's directly related to the Olympics, don't know, but it's the first time it's turning positive so might be related.’