Ms. Lagarde tells us that:

Britain’s inflation problems are worse because Brexit has drained the UK workforce, Christine Lagarde said as the European Central Bank stuck to its ultra-loose monetary stance.

“I don't want to take a political stand, but I think that there was a lot of non-UK labour force that eventually had to leave the United Kingdom, which has not been totally replaced,” the ECB president said.

“The shortage of work is actually having a bearing on the forces of the labour market in the UK.”

The absence of that EU workforce is leading to wage push inflation in the UK that is. As we pointed out elsewhere some time ago:

Brexit is about to give us a problem with this, though. Karl Marx was right: wages won’t rise when there’s spare labour available, his “reserve army” of the unemployed. The capitalist doesn’t have to increase pay to gain more workers if there’s a squad of the starving eager to labour for a crust. But if there are no unemployed, labour must be tempted away from other employers, and one’s own workers have to be pampered so they do not leave. When capitalists compete for the labour they profit from, wages rise.

Britain’s reserve army of workers now resides in Wroclaw, Vilnius, Brno, the cities of eastern Europe. The Polish plumbers of lore did flood in and when the work dried up they ebbed away again. The net effect of Brexit will be that British wages rise as the labour force shrinks and employers have to compete for the sweat of hand and brow.

If a lack of that free movement of EU labour leads to higher wages now, then the presence of that EU labour must have led to lower wages then. It is not just possible but mandatory in politics to have it both ways but reality doesn’t work that way.

See what joys we can uncover from, however amusingly, taking Ms. Lagarde seriously.

Do note though what the point is. It is not that immigration lowers wages for the incomers bring with them their demand as well as their labour. It’s that temporary immigration does, that creation of the reserve army outside the economy.