By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau on Tuesday said that the ECB was responsible for preventing second-round effects from the latest energy shock and was well positioned to do so if necessary.

Villeroy, who heads Banque de France and was speaking at the presentation of the French central bank’s 2025 annual report, also said in the foreword to the report that the “Iran shock” meant “a little more inflation and a little less growth.”

“We will act with pragmatism, guided by the data and the forecasts,” he said.

He also pushed back against any suggestion that euro area monetary policy was tighter than that of the Federal Reserve.

“But we must also dispel a misconception: our monetary policy remains more accommodative than the Fed’s, with significantly lower rates and a larger public sector securities portfolio,” he said.

In the same foreword, Villeroy said inflation had returned to 1.9% in the euro area and 1.1% in France in February 2026, and that monetary policy had fulfilled its price stability mission and would continue to do so in the face of the latest oil shock.