By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau said on Wednesday that the ECB would do whatever was necessary to reduce inflation to 2% or below in 2027 and 2028.
In an interview with French broadcaster France 2, Villeroy, who heads the Banque de France, said the current oil shock differed from those of 1973 and 1979, as those were “permanent,” whereas current price pressures, like in 2022, were expected to ease over time.
He described the impact on French GDP as “moderately negative,” noting that the conflict would result in “slightly weaker growth and slightly higher inflation” for both France and Europe.
Even in the more adverse scenarios, growth in France would be lower but remain positive, avoiding recession, he said.
Electricity prices were unlikely to surge as they did in 2022, thanks to increased nuclear energy supply, he said.
“I want to say another word about inflation, which is our responsibility: we, the central banks, will do what is necessary to bring inflation back to a maximum of 2% in 2027 and 2028,” he said.
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