Referring to the crisis in the Middle East as well as the war in Ukraine, she said: "We are monitoring the situation, we are very attentive to the economic consequences that could have, whether in terms of direct or indirect impact on energy prices, or the level of confidence that economic actors will continue to display."

A weaker world economy would also drag on the currency bloc, Lagarde said, alluding to the war in Ukraine and the crisis in the Middle East, which have caused turbulence on oil markets.

On Tuesday, banking giants told the Future Investment Initiative forum in Saudi Arabia, that the Israeli war in Gaza could deal a heavy blow to the global economy.

The US Federal Reserve warned Friday that the war in Gaza and the ongoing Ukraine conflict could cause harm to the world economy and boost global inflation.

Israel has been conducting a relentless bombing campaign on the Gaza Strip since 7 October, killing more than 7,000 Palestinians and injuring at least 17,000.