ECB's Villeroy: underlying inflation dynamics not yet solid enough

We should not plan to increase interest rates until we have seen a sustainable evolution in inflation, says Bank of France Governor Francois Villeroy de Galhau.

Key quotes:

   •  Underlying inflation dynamics not yet solid enough to durably support prices

   •  Core inflation has risen but remains at modest levels despite firming economic & labour recovery

   •  No doubts economic recovery & job creation will push wages higher, but questions remain on pace

   •  We are confident in the effectiveness of our monetary policy & are prepared to be patient about how long it lasts

   •  We must reduce the rate of our net asset purchases while keeping our overall monetary policy significantly accommodative

   •  Studies show we can continue to put downward pressure on the yield curve while keeping stock of assets high

   •  We continue to monitor exchange rates closely due to possible implications on inflation over the medium-term