CORRECTED-MNI BRIEF: ECB Set To Cut In 2024, Villeroy Says

(Corrects quote to make clear Villeroy was referring to the inflation outlook, not inflation expectations)

The European Central Bank is likely to make its first rate cuts of the cycle in 2024, thanks to easing inflation as growth softens, but decisions will be decided solely on the basis of incoming data, Bank of France Governor Francois Villeroy said in a speech on Tuesday.

"We will cut rates this year when the inflation outlook is firmly anchored at 2% – in actual data – and on a sustainable basis – in forward-looking data.”

Villeroy said he had never taken seriously fears of the “final kilometre” - of sticky inflation justifying an “excessively rigid” monetary policy. At the same time, he also emphasised that the ECB should not be in a hurry to cut either, noting the potential for data surprises. (See MNI INTERVIEW: ECB Could Discuss Cut Timing In January-Centeno)