September 24, 2019 / 7:22 AM / 20 days ago

ECB bond purchases unwarranted right now - Villeroy

PARIS, Sept 23 (Reuters) - One of the European Central Bank’s top policymakers on Tuesday criticised its decision this month to restart bond purchases, describing the move as unnecessary at the current time.

French central bank governor Francois Villeroy de Galhau, not usually seen as a policy hawk, offered rare public dissent over an ECB move, adding to criticism from more hardline Austrian, Dutch and German central bankers.

“I was not in favour of the resumption of net asset purchases at this time because I thought that further purchases are unnecessary right now - I stress right now - given the very low levels of both long-term interest rates and term premia,” Villeroy said in a speech at the Paris School of Economics.

The ECB cut rates to record lows earlier this month and announced plans to restart bond purchases in the hope that cutting borrowing costs could spark a recovery in the euro zone’s flagging economy and boost low inflation.

Reporting by Leigh Thomas; editing by Richard Lough

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