ECB Governing Council member, Bank of France Chairman Francois Villeroy de Galhau said he expected the French economy to be back to pre-pandemic level by year-end. He acknowledged that the auto sector was underperforming, but “areas of the economy are doing well.”
He also emphasized “there is still big difference in terms of rising energy prices and overall total inflation.” He expected inflation to get back to below 2% level by the end of next year.
“So today there is no reason, for example, for the European Central Bank to raise interest rates next year.” Though, “we remain very vigilant on inflation,” he added.
Regarding the risk of China’s Evergrande turning into a Lehman Brothers, Villeroy said “history is not in the process of being repeated”. “I think that Evergrande is mainly a Chinese problem,” he added.
