If the European Central Bank adjusts interest rates in the next six months, the move would likely be a cut, ECB policymaker Francois Villeroy de Galhau said on Thursday.
Speaking at the European University Institute in Italy, Villeroy said that barring a major external shock - including possible new military developments in the Middle East - any policy change by the ECB would likely aim to further accommodate growth.
The ECB this month signalled a pause in policy easing, even as projections show inflation dipping below its 2% target, reviving concerns about a return to ultra-low inflation.
Oil prices have surged 7% after Israeli strikes on Iran triggered missile retaliation. Villeroy, who is also governor of the Bank of France, said the ECB would watch closely for energy price spillovers into broader inflation trends.
He noted that the euro’s recent strength helps cushion the impact of rising oil prices: a 10% euro appreciation offsets the inflationary effect of a 10 euro oil price rise.
Market pricing now suggests a greater risk of euro zone inflation undershooting the ECB’s 2% target. ECB forecasts see inflation falling below 2% in Q2 this year and returning to target by 2027, aided by a new emissions trading system.
"In such a context, we need to remain alert and agile in all our next meetings," Villeroy added.
The Israel Defence Forces (IDF) and Shin Bet say they carried out targeted strikes on Hamas operatives and infrastructure in the Gaza Strip on Thursda...
Iran does not seek war with Israel or the United States but is prepared to respond if attacked, Iranian Foreign Minister Abbas Araghchi said on Thursd...
Russian drone and missile attacks on Kyiv early on Friday (9 January) killed at least 4 people, injured at least 19, and caused significant damage to ...
Syrian President Ahmad al‑Sharaa held separate telephone discussions with French President Emmanuel Macron and Turkish President Recep Tayyip Erdoğ...
Venezuela has released prominent Venezuelan-Spanish rights activist Rocío San Miguel and four other Spanish citizens, Spanish authorities said on Thu...
The Israel Defence Forces (IDF) and Shin Bet say they carried out targeted strikes on Hamas operatives and infrastructure in the Gaza Strip on Thursday (8 January) after detecting a failed rocket launch from the Gaza City area.
Russian drone and missile attacks on Kyiv early on Friday (9 January) killed at least 4 people, injured at least 19, and caused significant damage to residential buildings and critical infrastructure, Ukrainian officials said.
Syrian President Ahmad al‑Sharaa held separate telephone discussions with French President Emmanuel Macron and Turkish President Recep Tayyip Erdoğan on Friday (9 January), focusing on Syria’s internal security situation, reconstruction efforts and broader regional developments.
Venezuela has released prominent Venezuelan-Spanish rights activist Rocío San Miguel and four other Spanish citizens, Spanish authorities said on Thursday (8 January). Local rights groups report that promised releases of Venezuelan political prisoners are yet to materialise.
Open-source intelligence (OSINT) sources reported a significant movement of U.S. military aircraft towards the Middle East in recent hours. Dozens of U.S. Air Force aerial refuelling tankers and heavy transport aircraft were observed heading eastwards, presumably to staging points in the region.
Snow and ice stalled travellers in northwest Europe on Wednesday, forcing around a thousand to spend the night in Amsterdam's Schiphol airport but delighting others who set out to explore a snow-blanketed Paris on sledges and skis.
Diplomatic tensions between Tokyo and Beijing escalated as Japan slams China's export ban on dual-use goods. Markets have wobbled as fears grow over a potential rare earth embargo affecting global supply chains.
Two people have been killed after a private helicopter crashed at a recreation centre in Russia’s Perm region, Russian authorities and local media have said.
U.S. President Donald Trump has warned that Iran could face a strong response from the United States if its authorities kill protesters amid ongoing unrest.
U.S. oil major Chevron and private equity firm Quantum Capital Group are reportedly preparing a joint bid to acquire Lukoil’s international assets, as the sanctioned Russian energy company seeks to divest its overseas operations.
The U.S. dollar's share of global reserves fell to nearly 40% at the end of 2025, according to the International Monetary Fund (IMF), which says it's 10% lower than at the start of 2024. However, gold has risen and overtaken the dollar to be above 50% in global reserves according to the IMF data.
The U.S. dollar has strengthened against major peers on Tuesday, while the euro fell following slower-than-expected inflation in Europe. Market movements were relatively subdued as investors focused on upcoming U.S. economic data.
Wall Street closed higher on Tuesday, boosted by optimism over artificial intelligence (AI) and a strong rally in Moderna shares, with the Dow Jones Industrial Average approaching a record high.
India’s largest oil refiner, Indian Oil Corporation (IOC), has taken a significant step towards diversifying its crude oil supply by purchasing Colombian crude, from state oil company Ecopetrol, for the first time.
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