By Paul Hannon
The European Central Bank can't commit to delivering a rise in its key rate at its June meeting, and its decisions will instead be driven by evidence of changes in the economy, Bank of France Gov. Francois Villeroy de Galhau said Thursday.
The ECB last week left its key interest rate unchanged, but investors interpreted comments at a subsequent news conference as an indication that a rate rise is likely when officials next meet.
In his final speech on monetary policy before stepping down at the end of this month, Villeroy said that was a misunderstanding of how policy decisions should be made.
"This strikes me as looking a bit too much like disguised forward guidance," he said. "What should guide us is not a date but the data."
Villeroy said officials will focus on measures of price increases in goods and services excluding energy, changes in the inflation expectations held by households and businesses, and wages.
Figures released by the ECB on Wednesday pointed to a slowdown in wage growth this year despite the surge in energy prices since the start of the conflict in the Middle East, while core inflation has yet to pick up significantly, although inflation expectations have risen.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
05-07-26 0419ET
