Geopolitical shifts are causing the global economy to fragment into “competing blocs”, which could create a more inflationary environment, Christine Lagarde said on April 17.

The European Central Bank president said there could be “profound” effects for central banks, including “more instability” as supply becomes less elastic.

Lagarde noted central banks performed poorly during another major period of geopolitical upheaval, in the 1970s. “They failed to provide an anchor of monetary stability