Frankfurt (AFP)

New President of the European Central Bank Christine Lagarde heads her first monetary policy meeting on Thursday, where she intends to breathe new life into the communications sector and announce a review of the institution's strategy.

In view of the important economic support system already put in place by its predecessor Mario Draghi, with a program of asset purchases just revived in November at a rate of 20 billion euros per month, no major announcement is expected on this occasion.

"The enthusiasm aroused by the rise in power" of Ms. Lagarde in recent weeks "does not really come from possible policy changes but rather from the way its communication style will be different" from the Italian Judge Frederik Ducrozet, strategist at Pictet Wealth Management.

- Jargon -

The former head of the International Monetary Fund, the first woman to lead the monetary institute in Frankfurt, announced it in September in front of the European Parliament: "It is imperative to dust off language and spare an excess of technocratic jargon for to enable citizens, consumers, people who are not necessarily experts in monetary policy to understand what the ECB is for. "

His press conference from 13:30 GMT will mark his debut in the European monetary bath. It will be scrutinized on each of its words, the financial markets being on the lookout for any indication of its future intentions.

His predecessor had had a tumultuous end to his mandate by imposing economic support decisions on a minority of restive central bankers on the board of governors. Which had openly rebelled in public.

The challenge of the new president will be to pick up the pieces in a very divided monetary institute, between supporters and opponents of broad support to the economy. Even though it has so far signaled its willingness to stay on course with Mario Draghi.

The French warned MEPs that she was still "learning the language of central banks", not wanting to "disappoint those who think that every word carries the weight of one hundred years of monetary policy."

But, she also said, "I will have my own way of dealing with some key issues".

Discussion will be provided on Thursday by a new ECB macroeconomic projection forecast for 2022, with an expected cut in the 2020 growth target.

Lagarde should therefore be questioned "on the adequacy of monetary policy with the downturn," predicts Gilles Moec, an economist at Axa.

- Strategic Review -

She will also be asked about the controversy surrounding the negative rate on bank deposits, which has become a central tool for steering monetary policy. Reduced from -0.40 to -0.50% in September, it taxes the banks on cash they leave at the ECB counter, instead of lending them.

However, this device begins to have repercussions up to households, seeing some German banks begin to tax the first penny of the assets deposited in a new savings account.

Negative rates are criticized, particularly in Germany, where households prepare for retirement by saving.

Even unpopular, a further decline in the deposit rate is "likely in the first half of 2020" if the situation deteriorates, says Franck Dixmier, director of bond management at Allianz.

Wishing to mark a change of regime at the head of the ECB, Ms. Lagarde should also officially launch Thursday an overview of the objectives and instruments of the institution, a reflection on its strategy incorporating the imperative of climate protection.

The institution could, for example, set up refinancing rules for banks at its counter, favoring institutions providing them with guarantees for "green" assets, not linked to the most polluting activities.

The ECB could also review its inflation target, unchanged since 2003, and deemed too restrictive by some economists.

© 2019 AFP