Economy. The first ECB rate cut should be on June 6, “barring any surprises”

The Governor of the Bank of France François Villeroy de Galhau indicated to the JDD to be published on Sunday that the European Central Bank (ECB) would “barring any surprises” decide to cut its rates on June 6, believing that the battle against inflation was about to be won.

“Unless there are any surprises, we should decide on a first reduction at our next meeting on June 6,” declared François Villeroy de Galhau, who sits on the Governing Council of the ECB.

Inflation continues to fall

The governor of the Bank of France justifies this approach by “increasing confidence in the trajectory of disinflation”.

Inflation is approaching the ECB’s medium-term objective of 2%: it continued to decline in March in the euro zone, at 2.4% over one year, according to the latest figures from Eurostat.

In France, the consumer price index increased by 2.3% over one year last month according to INSEE, a clear slowdown compared to February. “We are winning the battle against inflation,” says François Villeroy de Galhau.

While maintaining its interest rates at their historic high, the ECB prepared the ground on Thursday for a first cut from June. This decline “must be followed by other declines between now and the end of the year”, estimates the governor who “pleads for pragmatic gradualism – according to economic data – and sufficiently agile”.