MNI BRIEF: Slower Inflation Allows More Rate Cuts-ECB Villeroy
MNI (LONDON) - Falling inflation makes it possible for the ECB to make further cuts in interest rates, Bank of France Governor Francois Villeroy said in an interview published Sunday.
Villeroy told French regional newspaper OUEST-FRANCE that this would remain the case even if the US Federal Reserve paused its own rate cuts.
The governor also warned about the protectionist plans of President-elect Donald Trump, which Villeroy said would mean "more inflation in the United States and less growth everywhere."He also expressed concerns that the rising US Budget deficit also posed a risk of an increase in long-term rates.
Markets expect a further cut in ECB interest rates when its Governing Council meets on December 12, with pricing on Friday suggesting rates could fall as low as 1.75% 9n 2025.