Lagarde warns: Federal Reserve's independence is crucial to the global economy, and the political turbulence in France is worrying.

European Central Bank President Christine Lagarde said Monday that the loss of independence from the Federal Reserve would pose a "serious threat" to the global economy. Speaking about Europe, Lagarde said the European Central Bank has achieved price stability and will take all necessary measures to control inflation in the eurozone. She also warned of a crisis in the French government. Federal Reserve Independence in Question Lagarde said in an interview on Monday that US President Donald Trump would find it "very difficult" to control the Federal Reserve. Lagarde also pointed out that some legal precedents restrict Trump from dismissing Fed governors. "If he really succeeds, I think this would pose a very serious threat to the US economy and the global economy. Monetary policy obviously has an impact on maintaining price stability in the US and ensuring optimal employment conditions," Lagarde said. Lagarde said that if the Federal Reserve loses its independence, "I think the stability of the US economy would be worrying, and since the US is the largest economy in the world, the impact would also affect the global economy, which would be very alarming." Trump has launched unprecedented attacks on the Federal Reserve, demanding a reduction in interest rates. He has not only criticized Fed Chair Jerome Powell multiple times, but also decided to dismiss Fed governor Lisa Cook, who is challenging this decision in court. European Inflation Under Control Lagarde, speaking of Europe, said that inflation has reached the target level of 2%, "We will continue to take necessary measures to ensure control of inflation and stability of prices." Lagarde made these comments as markets awaited the release of Eurozone CPI data for August on Tuesday. Economists predict an inflation rate of 2%, in line with the European Central Bank's target. European Central Bank Not Concerned About Eurozone Inflation It is widely expected in the markets that the European Central Bank will once again keep interest rates unchanged at a meeting in less than two weeks, as many policymakers have indicated that they are satisfied with the current 2% rate level. At the July meeting, most policymakers considered inflation risks "broadly balanced" and believed that the European economy was "resilient" despite unfavorable factors such as US tariffs and the Russia-Ukraine conflict. Although economists still expect the ECB to cut rates in December, investors remain cautious. Regarding the growth outlook, Lagarde emphasized that trade between the EU and the US has "significantly reduced" uncertainty. Political Turmoil in France Lagarde warned that the collapse of any government in the Eurozone is worrying, as it seems that the Prime Minister of her homeland France could be dismissed in a vote of confidence next week. Due to the opposition's refusal to support the significant budget cuts and tax increases proposed by French Prime Minister Franois Beru, the Paris government will be forced to resign on September 8. Lagarde said on Monday, "The risk of any Eurozone government collapsing is worrying." When asked about France, she added, "Markets are assessing the risk, and we have seen an increase in French risk in recent days." With the parliament severely divided, concerns among investors have been raised again about France's budget deficit. Last week, French bonds experienced a sell-off, leading to a rise in borrowing costs relative to Germany to the highest level since January. Political turmoil raises French bond risk premium Lagarde, who previously served as French Finance Minister, said that France is a "respected" borrowing country, but has been associated with a higher risk premium. She said, "I am very concerned about the spread. The additional cost of French bonds has risen, slightly lower than Italy, while this was not the case a few quarters ago." Lagarde said that solving debt issues is crucial for all countries, but she is unwilling to comment on the political means to achieve this goal. She said, "Discipline is needed in public finances to send a signal that the government wants to achieve a sustainable debt level, establish enough credibility in the financial markets, thereby providing funding support for the operation of the country, local governments, and the overall national finances."