Villeroy (BdF) calls for avoiding fueling market volatility | Photo credits: ROMUALD MEIGNEUX/SIPA
PARIS, Sept 27 (Reuters) – Politicians and economic leaders must be careful not to fuel financial market volatility, Banque de France Governor François Villeroy de Galhau told the Paris Finance Committee on Tuesday. National Assembly.
While the spike in volatility of recent days can be partly explained by the appreciation of the dollar, driven by its status as a safe haven, François Villeroy de Galhau also mentioned the impact of the British government’s announcement of a stimulus package leading to “massive” budget deficits.
“It is vital not to add uncertainty to uncertainty, and to stay on course,” this member of the Governing Council of the European Central Bank (ECB) told the deputies.
This implies, he specified, to pursue “a European monetary policy of price stability” and “a French budgetary policy anchored on a standard of expenditure really held, and allowing deleveraging over time”.
“Going it alone is counterproductive,” he added.
The measures unveiled by Britain’s new finance minister, Kwasi Kwarteng, on Friday sent the pound plummeting and UK government debt yields soaring. (Report Leigh Thomas, French version Marc Angrand, edited by Sophie Louet)