The European Central Bank has yet to continue raising interest rates. The fight against inflation is not yet over. This was said at the World Economic Forum in Davos by Francois Villeroy de Galhau, Governor of the Bank of France and member of the ECB’s Governing Council.
Continuing to raise interest rates
“We must stay on track in our battle against inflation. It’s not won yet,” Villeroy said during a regular meeting of global leaders at the World Economic Forum in Davos. By that he meant continuing to raise interest rates by the European Central Bank.
It has already increased its base rate by a total of 2.5 percentage points since last July and will probably increase it by another half percentage point at its February meeting. And quite possibly, the same step will follow in March.
A more resilient economy
“If you look at the situation in Europe, it’s similar to the situation in the United States. The economy is more resilient than we expected, we will probably avoid a recession, which I would not have thought three months ago,” Villeroy added. According to him, this is also the reason why it is appropriate to continue raising rates, as it is unlikely to significantly damage the eurozone economy.