Christine Lagarde (ECB President) said that the European Central Bank will likely raise its deposit rates out of negative territory by September. It could also lift them further if they see inflation stabilizing at 2%.

Lagarde stated in a blog posted on the ECB website that “Based upon the current outlook we are likely in a position in the third quarter to exit negative interest rate,”

Currently the ECB has a deposit rate of -0.5%. This means banks have to store cash at their central bank.

“If inflation stabilizes at 2% in the medium-term, then a gradual further normalization of interest rates toward the neutral rate is appropriate”, Lagarde said. She also suggested that rates could be raised if “the euro area economy was overheating”.