ECB will do what it takes to bring inflation back to 2%, Villeroy says

The head of the French central bank said that the European Central Bank was needed to return inflation back to its 2% goal.

In remarks to France Info TV, Governor Francois Villeroy de Galhau, said that: "The peak is close, but inflation remains too high today in France and in Europe," Bloomberg reported.

"“We will bring inflation toward 2% by the end of 2024 or beginning of 2025 — that’s a commitment, not just a forecast."

He also reportedly said that strong food inflation might last a few more months before starting to slow by the end of 2023.

Earlier, Paul Doyle at Columbia Threadneedle Investments, had told clients that he believed markets were anticipating too much tightening from the ECB, Dow Jones Newswires reported.

That was because the neutral level of interest rates for the single currency bloc was far lower than that in the US.

"Europe's economy is too fragile to weather the rate hikes seen from the Fed."