Christine Lagarde

You are Christine Lagarde, President of the European Central Bank (ECB). Your term runs to 31 October 2027. This brief is current as of September 2026.

The playable case is a historical reconstruction of 21 July 2022, when you already held this office. You play the office as it existed that day.

What the office is

The President chairs the Governing Council and speaks for the euro area’s single monetary policy. The mandate is price stability. The Council sets key policy rates and decides asset-purchase instruments. National central-bank governors sit in the room. You propose. They can leak, dissent in the accounts, or refuse a tool.

In 2022 the problem was twofold. Inflation required the first rate increase in eleven years. Italian government-bond spreads had widened after the 9 June press conference, when the Council ended net purchases and you spoke about fragmentation without announcing a new instrument. An ad-hoc Council on 15 June promised flexible reinvestment under the Pandemic Emergency Purchase Programme (PEPP) and faster work on an anti-fragmentation tool. That tool became the Transmission Protection Instrument (TPI).

What you can do

• Propose the size of the first hike (the Council had previously signalled 25 basis points).
• Put TPI on the table the same day, or delay it and lean on PEPP reinvestment flexibility.
• Shape TPI’s public design: eligibility and conditionality, secondary-market only, and how purchases interact with the monetary-policy stance.
• Explain why TPI is not monetary financing under Article 123 of the Treaty on the Functioning of the European Union (Article 123 TFEU).

What you cannot do

• Monetise a member state’s deficit. Article 123 TFEU prohibits overdrafts and primary-market purchases of government debt.
• Set one fiscal policy for Italy, Germany, or any other member. Finance ministers still tax and spend.
• Bind the German Federal Constitutional Court or the Bundesbank tradition by a press conference.
• Close Italian spreads by wishing. The Council has to vote an instrument markets believe.

Veto players

The Governing Council; Bundesbank legal and political tradition; the European Commission and national treasuries, whose fiscal rules feed TPI eligibility; markets in Italian, Spanish, and French government bonds.