PARIS (Reuters) – Financial markets should not jump to conclusions about the evolution of European Central Bank (ECB) rates, François Villeroy de Galhau said on Friday, the day after an eighth consecutive rate hike by the European Central Bank (ECB). ECB.
The Governor of the Banque de France, member of the Governing Council of the ECB, considered “excessive” the reaction of the markets to Thursday’s announcements, which resulted in a rise in bond yields and a strengthening of expectations on a future deposit rate above 3.9%.
“Our future decisions will be based on (macroeconomic) indicators, meeting after meeting,” François Villeroy de Galhau told a conference in Paris.
“As a result, no one should rush to premature conclusions about our timing or terminal rate, and recent market volatility appears somewhat excessive,” he added.
Beyond its new rate hike, the ECB above all raised its inflation forecasts on Thursday until 2025 to a level that its president Christine Lagarde deemed “unacceptable”.
François Villeroy de Galhau, however, insisted on Friday that the next decisions of the ECB would not be based on projections but on macroeconomic data, which so far suggests that the tightening of monetary policy in the euro zone produces effects.
(Written by Leigh Thomas, Bertrand Boucey, edited by Blandine Hénault)
Copyright © 2023 Thomson Reuters
I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.
