ECB’s Villeroy Vows Again that ECB Will Do What Is Needed to Return HICP to Around 2%
19 January 2022
By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau on Wednesday repeated his vow that the ECB would do what is necessary to get inflation back to around 2%.
In an interview on French radio network France info, Villeroy, who heads Banque de France, said of the French economy that ‘we have good growth that is not being affected by Omicron apart from some sectors, of course, like cafes, restaurants and hotels.’
‘We have good growth, but we have too much inflation’, he said. ‘When one looks out two years, beyond Covid, the picture is going to invert. That is, we would have good inflation around 2%, but not enough growth.’
The current hump of inflation reflects the strength of growth and must also be seen in the context as well of low inflation a year ago, he said. Inflation rates would moderate for the rest of the year, reaching below 2% in France, he said.
‘And what I’m going to tell you this morning is that I guarantee that we, the European Central Bank and the Banque de France, we will do what is necessary to return inflation to around 2% over time’, he said. ‘That is our mission as central bank.’