“The Council of Governors considered that the risks on growth remained downwards, with an uncertainty which remains very high,” said the governor of the Banque de France.
The Governor of the Banque de France said on Friday that the European Central Bank remained “completely open” on its next monetary decisions, after having maintained its interest rates the day before the backdrop of commercial showdown between the EU and Washington.
This maintenance comes after seven consecutive drops, and eight in total since June 2024, which brought back the deposit rate of the ECB, which refers, to 2%, against a 4% peak reached in full inflationary wave. She explained in particular wishing to take the time to assess imminent decisions in the dispute on American customs duties.
“However, the Council of Governors considered that the risks on growth remained downwards, with an uncertainty which remains very high,” said the governor of the Banque de France on Friday, François Villeroy de Galhau, in a written reaction transmitted to the press.
After having reached record levels in the wake of the covid-19 pandemic and the invasion of Ukraine by Russia, “inflation-and with it wages-is confirmed to be very well controlled: it is in the euro zone at our target of 2%, and less in France at 0.9%”, he continued.
“The increases in customs duties in the United States, the magnitude of which is still uncertain, should not raise it, while the appreciation of the euro represents a sensitive disinflationist effect,” he said.
For the governor, “it is therefore important to remain completely open on the continuation of monetary decisions. More than ever, in volatile environment, agile pragmatism according to data and forecasts is essential. ”
He also reiterated his call for reinforced economic and financial integration of the European Union “against the American protectionist”.
According to several European sources on Thursday, a trade agreement between the EU and the United States seems to be emerging, which provides for customs from 15% on European exports with sectoral exemptions.