Free Trial

MNI BRIEF: EZ Inflation To Beat December Projection - Villeroy

(MNI) LONDON
(MNI) London

Interest rates will likely peak this summer, with inflation falling to the ECB’s 2% target level by early 2025, Banque de France governor Francois Villeroy de Galhau predicted in a joint interview with Bundesbank boss Joachim Nagel on Tuesday -- a marked downward revision from previous official estimates.

Policymakers are expected to hike rates by another 50bps when they meet next week in Frankfurt, with another half-point hike the likely starting point for discussions in March (MNI SOURCES: ECB Doves Eye Smaller Hikes As Inflation Falls).

December's Eurosystem staff projections put average HICP inflation at 6.3% in 2023, 3.4% in 2024 and 2.3% in 2025. However, “we will probably have reached the peak in interest rates by next summer, and inflation will come down to the 2% level by the end of 2024 to 2025,” Villeroy said.

MNI London Bureau | +44 20 3983 7894 | luke.heighton@marketnews.com
True
MNI London Bureau | +44 20 3983 7894 | luke.heighton@marketnews.com
True

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.