ECB Intervention Statement by Bank of France Governor Moulin

The Governor of the Bank of France announced that there are no conditions for an intervention in France, stating that the European Central Bank is focused on fighting inflation rather than dealing with countries' fiscal problems.

ECB's Mandate and Emphasis on Inflation

The Governor of the Bank of France stated that the ECB exists not to deal with countries' fiscal problems, but to fight inflation and keep inflation around 2 percent. Accordingly, he expressed that the conditions necessary for the ECB to intervene today are not present.

Budget Targets and Bond Market Developments

As concerns mounted that France's minority government could implement spending cuts and tax hikes to reduce the budget deficit, fluctuations were experienced in bond markets in recent days. The 10-year yield spread compared to German bonds hovered around 127 basis points following a wave of selling.

Political Debates and Presidential Elections

Investors are concerned about France's long-term debt outlook ahead of the presidential elections in May. Candidates promising measures that would violate the independence of the central bank have left the central bank in the middle of the election campaign.

Statements by Political Figures and Pressure Claims

While left-wing politician Jean-Luc Mélenchon's proposal to cancel debts set the agenda, far-right leader Marine Le Pen argued that the ECB should intervene to ease the interest burden. Moulin emphasized that he will continue to defend his institution against those trying to intimidate him.