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WASHINGTON (Reuters) – The European Central Bank (ECB) may have “a little way to go” in raising interest rates, but most of its work is already done and the most important subject is now the duration of high rates, Banque de France Governor Francois Villeroy de Galhau said on Wednesday.

After raising its rates at an accelerated pace last year, the ECB is wondering about a possible slowdown in its monetary tightening and about the terminal level that its deposit rate, currently set at 3%, must reach in order to bring the inflation towards its target of 2%.

“We may still have a bit of a way to go on rate hikes in our next meetings, but I think it is premature to decide now what we will do in May,” said François. Villeroy de Galhau during a speech in Washington.

“We have already accomplished most of our journey of raising rates and the most important economic effect that awaits us will be the repercussion of what is already underway,” added the central banker, who sits on the board of governors. of the ECB.

Markets are pricing in an additional 75 basis point ECB rate hike by September, but investors are divided on the timing of those hikes.

While an increase of 25 basis points is expected at the next ECB meeting on May 4, the hypothesis of a stronger increase has recently been reinforced.

François Villeroy de Galhau, however, played down the impact of future rate hikes. “The delayed effect of our past rate hikes will be greater than that of our future decisions,” he said.

The ECB indicated that once the peaks of the rates reached, the latter would remain at a high level for a certain time, without giving more precision to the investors on its intentions.

(Report Balazs Koranyi, Blandine Hénault for the , edited by Jean Terzian)

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