NEW YORK, April 16 (Reuters) - The European Central Bank will be in a position to adapt the pace of rate cuts if the fallout from Middle East tensions have a lasting impact on energy prices and inflation, ECB policymaker Francois Villeroy de Galhau said on Tuesday.
The ECB has opened the door to a first rate in June as inflation eases back towards its 2% target and financial markets see three rate cuts over the course of this year.
Villeroy, who is also governor of the French central bank, said the pace would be guided by the flow of economic data and decided strictly on a meeting-by-meeting basis.
"That said, we will monitor closely the geopolitical developments in the Middle-East, and their possible spill-overs on energy prices," Villeroy told an event at the Economic Club of New York.
"If ever these consequences happened to be lasting and propagating – i.e. affecting underlying inflation –, we would have ample room to adjust the pace." (Reporting by Michael Derby; writing by Leigh Thomas; Editing by Benoit van Overstraeten)
