Currently, the deposit rate stands at 2.75%, following a recent 25 basis point cut implemented on January 30, 2025.

Villeroy indicated that the ECB could lower its deposit rate to 2% by the summer of 2025.

Further reductions in the deposit rate are anticipated in March 2025, driven by concerns about sluggish economic growth that are overshadowing inflation issues.

In addition to rate cuts, Villeroy highlighted that consolidation among European banks could improve their global competitiveness.

In an interview published today, Francois Villeroy de Galhau, head of the Bank of France and a key policymaker at the European Central Bank (ECB), discussed potential changes to the ECB's deposit rate.