European Central Bank (ECB) Governing Council member Francois Villeroy de Galhau said on Thursday that the victory against inflation is "in sight," predicting that the euro area could reach the 2% inflation target in early 2025. He warned of the danger of undershooting inflation if economic growth remains weak.
Villeroy said the ECB has "significant room" to ease the current restrictive stance and advocated taking interest rates down to the neutral level. He insisted there is "every reason" to cut rates in December, although the question of the size of the cut remains open. He said the possibility of cutting rates at every ECB meeting in the near future should not be excluded and hinted he could be in favor of monetary easing below the neutral rate.
