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Investing.com -- The European Central Bank is more likely to cut interest rates than raise them as its next move, according to Governing Council member Francois Villeroy de Galhau.
The French central-bank chief told Bloomberg Television on Tuesday that this stance reflects a greater number of downside risks to the inflation outlook. While he believes monetary policy is currently well-positioned, he acknowledged that conditions could change.
"If there is a next move, a rate cut is more plausible, more likely than a rate hike," Villeroy said during an interview in New York, where he was attending the Bloomberg Global Regulatory Forum. "I see few risks on the upside" but "there are more risks on the downside."
Villeroy has consistently been among ECB policymakers who remain open to additional rate cuts if economic growth and inflation prove weaker than forecasted. Recent economic data from Germany, the eurozone’s largest economy, has shown a continuing decline in the manufacturing sector, while political instability in France is negatively affecting economic confidence.
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