BALI, Indonesia - The European Central Bank has no reason to follow in the footsteps of the Federal Reserve, a member of the Governing Council of the bank said on Sunday.
Addressing a conference forming part of the annual International Monetary Fund in Bali, in the resort area of Nusa Dua on Sunday, Francois Villeroy de Galhau said the ECB needed to set its own policy, in accordance with its own economic environment.
The central bank has an inventory of 2.6 trillion euro in bonds but is expected to end its issuance by the end of 2018. It is also conditioning the market to a foreseeable end in low interest rates. A hike could come as early as late 2019, he said.
Referring to bonds maturing next year, Galhau said: “We should keep our options open about the timing of our reinvestment in the following years.”
He said interest rates in Europe would remain as they are through to the end of next year.
“As we approach the summer of 2019, the balance will shift in favour of detailing our forward guidance,” he said.
“I think the euro area can determine its own course,” he added.