PARIS ( – The European Central Bank (ECB) must rethink its monetary analysis, possibly including indicators such as the assets of financial institutions and nominal growth in gross domestic product (GDP), the governor of the European Union said on Wednesday. Bank of France, François Villeroy de Galhau.

Monetary analysis is currently secondary to economic analysis in the decisions of the Governing Council of the ECB, which leads some to suggest its abandonment.

François Villeroy de Galhau, member of the Governing Council of the ECB, thinks on the contrary that it could be enlarged within the framework of the strategic reflection initiated by the Frankfurt Institute on its objectives and its methods of analysis.

“We need to rethink our ‘second pillar’ – the current monetary analysis – particularly in light of financial stability concerns,” the governor of the Banque de France said at an online conference on the financial sector.

Among the indicators of the financial sector, the ECB could thus be more concerned with the assets of financial institutions, including non-banks, he added.

However, the ECB could also look at other economic indicators such as nominal GDP growth, often used to assess the sustainability of both public and private debt, continued François Villeroy de Galhau. Employment and income distribution could also be taken into account.

The governor of the Banque de France also judged that the current monetary policy of the ECB was appropriate but declared that the latter stood ready to “act more if necessary”.

(Leigh Thomas; French version Bertrand Boucey)