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The global economy is facing rifts comparable to the pressures that resulted in “economic nationalism”, a collapse in global trade and the Great Depression of the 1920s, the president of the European Central Bank has warned.

“We have faced the worst pandemic since the 1920s, the worst conflict in Europe since the 1940s and the worst energy shock since the 1970s,” said Christine Lagarde on Friday, adding that these disruptions combined with factors such as supply chain problems had permanently changed global economic activity.

In a speech at the IMF in Washington two days after the Federal Reserve cut interest rates by 50 basis points, pushing US equity markets to record highs, the ECB president argued that several parallels “between the “two twenties — the 1920s and 2020s — stand out”, pointing to “setbacks in global trade integration” and technological advances in both eras.

While monetary policy in the 1920s made matters worse as adherence to the gold standard pushed leading economies into deflation and banking crises, “we are in a better position today to address these structural changes than our predecessors were”, stressed Lagarde.

A century ago, she said, central bankers learnt the hard way that pegging the currency to gold and fixed exchange rates was “not robust in times of profound structural change” as it pushed the world into deflation, fuelling “economic malaise” and contributing to a “cycle of economic nationalism”.

Today, central bankers’ tools for preserving price stability “have proved effective”, she said. Lagarde pointed to the quick fall in inflation once central banks started to raise rates in 2022. Consumer prices had shot up following a surge in post-pandemic demand, global supply chain disruptions and big rises in energy prices after Russia’s full-scale invasion of Ukraine.

She described the episode as an “extreme stress test” for monetary policy.

Central bankers have been able to ease monetary policy in recent months as price pressures abated. Annual inflation in the Eurozone peaked at 10.6 per cent in October 2022 but hit a three-year low of 2.2 per cent in August.

Lagarde said it was “remarkable” that central banks managed to get inflation under control within less than two years while avoiding a rise in joblessness. “It is rare to avoid a major deterioration in employment when central banks raise rates in response to high energy prices. But employment has risen by 2.8mn people in the euro area since the end of 2022,” she said.

However, the ECB president warned against complacency, saying that issues including possible setbacks to globalisation, a partial disintegration of global supply chains, the market power of tech giants such as Google and the “rapid development of artificial intelligence” could all test central bankers.

Uncertainty would “remain high” for monetary policymakers, Lagarde said, adding: “We need to manage it better.”

The ECB will investigate these issues in detail in its looming strategy review, she said. While its 2 per cent medium-term inflation target would not be scrutinised, “we will consider what we can learn from our past experience with too-low and too-high inflation”, she said.

The ECB would also analyse its assessment and disclosure of risks. For example, its baseline inflation scenario could be “balanced . . . with real-time information”, and the central bank could also disclose alternative scenarios.

ROME (AP) — The woman whose company was linked to thousands of pagers that exploded in Lebanon and Syria this week is under the protection of the Hungarian secret services, her mother told The Associated Press on Friday.

Cristiana Bársony-Arcidiacono has not appeared publicly since the deadly simultaneous attack that targeted Hezbollah on Tuesday and that has been widely blamed on Israel. She is listed as the CEO of Budapest-based BAC Consulting, which the Taiwanese trademark holder of the pagers said was responsible for the manufacture of the devices.

Her mother, Beatrix Bársony-Arcidiacono, told the AP that her daughter had received unspecified threats and “is currently in a safe place protected by the Hungarian secret services.”

The “Hungarian secret services advised her not to talk to media,” she said by phone from Sicily.

Hungary’s national security authorities did not immediately respond to a request for comment, and the AP could not independently verify the claim.

Two days of attacks this week, first targeting pagers and then walkie-talkies, have killed at least 37 people and wounded more than 3,000, including civilians. Hezbollah and the Lebanese government have blamed Israel, which has neither confirmed nor denied involvement.

Cristiana Bársony-Arcidiacono’s company came under scrutiny after Gold Apollo, a Taiwanese firm, said it had authorized BAC Consulting to use its name on the pagers that were used in the first attack, but that the Hungarian company was responsible for manufacturing and design.

On Wednesday, a Hungarian government spokesman said the pagers delivered to Hezbollah were never in Hungary, and that BAC Consulting merely acted as an intermediary.

Beatrix Bársony-Arcidiacono, who also uses the name Beatrice, echoed that.

“She is not involved in any way, she was just a broker. The items did not pass through Budapest. … They were not produced in Hungary,” she said.

BAC Consulting shares the ground floor of a modest building in Budapest with numerous other enterprises, but has no physical offices and uses the property in Hungary’s capital — like the other companies based there — only as an official address, according to a woman who emerged from the building earlier this week and refused to be named.

The company’s website said it specialized in “environment, development, and international affairs.” The corporate registry listed 118 official functions including sugar and oil production, retail jewelry sales and natural gas extraction.

It brought in $725,000 in revenue in 2022 and $593,000 in 2023, according to the company registry. Last year, the company spent nearly $324,000, or around 55% of its revenue, on “equipment.”

The company’s website has been unavailable since Wednesday.

Beatrix Bársony-Arcidiacono said her daughter was born in Sicily and studied at the University of Catania there before pursuing a Ph.D. in London. She worked in Paris and Vienna before moving to Budapest in October 2016 to care for her elderly grandmother.

In May 2022, she incorporated the company at the heart of the mystery of the pagers.

On social media, the younger Bársony-Arcidiacono describes herself as a strategic adviser and business developer with a doctorate who has worked for major international organizations such as the International Atomic Energy Agency and the CARE humanitarian agency, as well as for venture capital firms.

The 49-year-old received her Ph.D. from University College London, where she was enrolled in the early to mid-2000s, according to her LinkedIn page. There, she worked with Ákos Kövér, a Hungarian physicist and now-retired professor, who confirmed her enrollment.

Kövér said of Bársony-Arcidiacono in an email to the AP: “At the time, we also published some joint articles. I am not aware of her other activities, as far as i know she has not done any scientific work since then.”

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Spike reported from Budapest, Hungary. El Deeb reported from Beirut.

America’s Three Mile Island nuclear energy plant, the site of a high-profile accident that discouraged nuclear power development in the US for decades, is preparing to reopen as Microsoft looks for ways to satisfy its growing energy needs.

The tech giant said it had signed a 20-year deal to purchase power from the Pennsylvania plant, which would reopen in 2028 after improvements.

The agreement is intended to provide the company with a clean source of energy as power-hungry data centres for artificial intelligence (AI) expand.

The plan will now go to regulators for approval.

The owner of the plant, Constellation Energy, said the reactor it planned to restart was adjacent to, but “fully independent” of the unit that had been involved in the 1979 accident, the worst in US history.

It caused no injuries or deaths but it provoked widespread fear and mistrust among the US public.

But nuclear power is the subject of renewed interest as concerns about climate change grow – and companies face increased energy needs tied to advances in artificial intelligence.

In a statement announcing the deal, Constellation boss Joe Dominguez said nuclear plants were the “only energy sources” that could consistently deliver an abundance of carbon-free energy.

“Before it was prematurely shuttered due to poor economics, this plant was among the safest and most reliable nuclear plants on the grid, and we look forward to bringing it back with a new name and a renewed mission,” he said.

Microsoft called it a “milestone” in its efforts to “help decarbonize the grid”.

On 28 March, 1979, a combination of mechanical failure and human error led to a partial meltdown at the nuclear power plant in central Pennsylvania.

The accident occurred about 04:00 in the Three Mile Island plant’s second unit.

The plant’s Unit 1 – which would reopen under the Microsoft deal – continued to generate power until closing in 2019.

Its owner at the time, Exelon, which spun out Constellation as an independent business in 2022, said the low cost of natural gas extraction had made nuclear-generated electricity unprofitable.

Constellation said it would invest $1.6bn (£1.2bn) to upgrade the facility, which it would seek approval to operate through 2054.

Reopening the plant would create 3,400 direct and indirect jobs and add more than 800 megawatts of carbon-free electricity to the grid, generating billions of dollars in taxes and other economic activity, according to a study by The Brattle Group cited by Constellation.

Local media reported earlier this month that word of its possible revival had drawn some protesters.

Microsoft is not the only tech company that is turning to nuclear power as its energy needs expand.

Earlier this year, Amazon also signed a deal which involves purchasing nuclear energy to power a data centre. Those plans are now under scrutiny by regulators.