4u Created
Image default

ECB’s Villeroy says in favour of 50 bp rate hike on Dec. 15 By Reuters

© Reuters. FILE PHOTO: Francois Villeroy de Galhau, Governor of Banque de France, attends the Paris Europlace International Financial Forum in Paris, France, July 12, 2022. REUTERS/Benoit Tessier/File Photo

PARIS (Reuters) -The European Central Bank should raise interest rates by 50 basis points (bp) on Dec. 15, French central bank chief Francois Villeroy de Galhau said on Sunday, reinforcing expectations for the ECB to slow the pace of monetary tightening.

The ECB has raised rates by a record 200 basis points since July, but a slowdown in euro zone inflation and more benign signals from the U.S. Federal Reserve have solidified the case for a 50 bp move after back-to-back 75 bp hikes.

While markets now largely price a 50 bp hike after a long-list of policymakers have backed the move, comments from Villeroy, a centrist on the rate-setting Governing Council, suggest the step is all but a done deal.

In an interview with France’s LCI television, ECB Governing Council member Villeroy also said he expects rate hikes will continue after Dec. 15 and could not say when they would stop.

Villeroy said he expects inflation will peak in the first half of next year and then start easing off.

“I expect inflation will be beaten by around 2024-2025,” he said, adding that he thinks France and Europe will escape a hard economic landing and that a recession next year is unlikely.

Source link

Related posts

Thousands to rally against gun violence in Washington, across U.S. By Reuters

FBI found more than 11,000 government records at Trump’s Florida home By Reuters

The painter who shared China’s COVID protests with the world By Reuters