ECB Governing Council member Francois Villeroy de Galhau said, “the three conditions of our forward guidance on interest rates are, according to my personal judgment, fulfilled. Barring unforeseen new shocks, I would think it reasonable to have entered positive territory by the end of this year.”
But he’s vague on the timing of the first hike, as “while I wouldn’t preclude the next few Governing Council meetings, I would rather set a marker a bit further down the road.” He added the ECB’s push to normalize policy “will be guided by an active use of optionality and gradualism.”
On asset purchases, Villeroy said “seen from today the case for continuing to press the accelerator and adding further net purchases after June is not obvious.”
