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The euro zone needs to strengthen domestic demand, including via greater public investment, if it is to withstand weakness abroad, the European Central Bank’s new President Christine Lagarde said on Friday.

“The answer lies in converting the world’s second largest economy into one that is open to the world but confident in itself – an economy that makes full use of Europe’s potential to unleash higher rates of domestic demand and long-term growth,” Lagarde said.

She reaffirmed the ECB would do its part by continuing “to support the economy and respond to future risks” while monitoring “the side effects” of its easy money policy. - Source: Reuters-