March 2, 2020 / 8:35 AM / a month ago

ECB can do more if needed, but we're not there yet: Villeroy

Governor of the Bank of France Francois Villeroy de Galhau speaks during a news conference at the G7 finance ministers and central bank governors meeting in Chantilly, near Paris, France, July 18, 2019. REUTERS/Pascal Rossignol

PARIS (Reuters) - The European Central Bank is prepared to support the economy if needed in the face of the coronavirus outbreak, although more action is not yet needed, ECB policymaker Francois Villeroy de Galhau said on Monday.

Villeroy, who is also head of France’s central bank, said that the ECB’s monetary policy was already accommodative, providing abundant liquidity to banks financing the economy.

The ECB was also providing support through a commitment to keep interest rates low as long as the economy needed, Villeroy told French radio BFM Business.

“If more was needed and we were convinced that it would be effective, then we can do more, but we are not there yet,” Villeroy said.

Villeroy said the brunt of the economic impact was being felt so far by companies, but warned that the longer the crisis dragged on the more it would hurt household consumption.

He added that there was a risk that the fears about the virus could have a worse impact than the virus itself, which made it all the more important to keep a cool heads.

Reporting by Leigh Thomas; Editing by Toby Chopra

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