By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Emmanuel Moulin said on Friday that the ECB was in a “good position” following its June interest rate hike, adding that the balance of risks was “in the right place.”
Moulin, who heads the Banque de France, told Bloomberg TV that the ECB had been right to raise interest rates in June and that the presence of the milder scenario had given policymakers greater confidence in taking that decision.
Asked where the economy currently stood within the ECB’s scenario framework, Moulin said policymakers remained “comfortable in our base scenario” and described recent developments around the Strait of Hormuz as “good news.”
He said he did not expect the ECB’s next few policy meetings to be more difficult from a decision-making perspective, adding that the Governing Council had already made it clear that “we were not entering into a new cycle of hikes.”
Moulin described the June rate increase as a “perfectly legitimate” decision and reiterated that future policy choices would continue to be made on a meeting-by-meeting basis.
“But what we see is at this moment, at this juncture, we’re in a good position,” he said. “And the balance of risk is in the right place.”
The recent decline in oil prices should help ease services inflation and said there was still no evidence of second-round effects, he said.
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