The French economy is unlikely to suffer a hard landing, although a “limited and temporary recession” remains possible, European Central Bank (ECB) member and Bank of France president François Villeroy de Galhau said on Thursday. ).
“The French economy is holding up a little better than expected,” Villeroy told Europe 1 radio.
On Wednesday, the Bank of France said the French economy will barely achieve positive growth in the last quarter of the year.
The ECB raised interest rates by 200 basis points in total to 1.5% in just three months, its fastest pace of increases on record. Markets are predicting a spike of around 3% next year, suggesting a new series of highs is yet to come to contain broad and rising inflation.
Villeroy also told the Irish Times this week that the ECB should not stop raising rates until underlying inflation has clearly peaked, but may slow the rate of hikes once rates reach a level that begins to constrain economic growth.
Source: CNN Brasil
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