ECB’s Villeroy: ‘Expect a Decisive June Meeting and an Active Summer’
16 May 2022
By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau on Monday said the June monetary policy meeting should be ‘decisive’ and warned against allowing the euro to weaken too much.
In a speech for the 15th Emerging Markets Forum, Villeroy, who heads Banque de France, said that ‘[t]he consensus in our Governing Council is now clearly emerging…: to fight an inflation which is not only higher but broader, we now have to normalise our monetary policy.’
‘I won’t add my precise calendar prediction to the many existing ones, but expect a decisive June meeting, and an active summer’, he continued. ‘The pace of the further steps will take into account actual activity and inflation data with some optionality and gradualism, but we should at least move towards the neutral rate.’
‘And let me stress this: we will carefully monitor developments in the effective exchange rate, as a significant driver of imported inflation’, he added. ‘A euro that is too weak would go against our price stability objective.’