October 27, 2017 / 7:42 AM / in a year

Expected firmer inflation justifies bond-buy reduction: ECB's Villeroy

FILE PHOTO -- Governor of the Bank of France Francois Villeroy de Galhau attends a press conference after the Franco-German Financial Council meeting in Berlin, Germany, September 23, 2016. REUTERS/Axel Schmidt/File Photo

PARIS (Reuters) - The ECB’s confidence that the rate of inflation will steadily rise toward its target justifies its decision to reduce bond purchases, ECB policymaker Francois Villeroy de Galhau said on Friday.

The ECB said on Thursday it would cut its bond purchases in half from January but also extend the buying program until the end of next year.

“It’s an essential step toward their possible end afterwards, which is justified by our confidence in the gradual convergence of inflation toward our medium-term target of two percent,” Villeroy, who is also the governor of the Bank of France, told an insurance conference in Paris.

Reporting by Leigh Thomas; editing by Luke Baker

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