EU: Trichet Says Market Tensions Receding, ECB `Ready' - by Christian Vits
European Central Bank President Jean- Claude Trichet said financial-market tensions are receding and the bank remains committed to fighting inflation. ``Tensions have receded while remaining significant,'' Trichet said today in a speech at a convention of Germany's Christian Democratic Union party in Wiesbaden, near Frankfurt. ``The ECB's Governing Council stands ready to counter upside risks to price stability, in line with its mandate.'' The ECB shelved a planned rate increase in September to assess the economic impact of the U.S. housing slump, which made banks reluctant to lend and pushed up credit costs. Since then, euro-region inflation has accelerated to the fastest pace in more than six years, prompting some ECB council members to call for a rate increase. Economic growth in the euro region is forecast to slow to about 2 percent in 2008 from around 2.6 percent last year, according to the ECB's December forecasts. The bank predicts inflation will accelerate to about 2.5 percent this year from 2.1 percent in 2007.Trichet also said today that he expects a ``relatively soft landing'' in Europe's housing market. While latest data suggest ``a cooling,'' house-price growth ``remains relatively elevated'' from a historical perspective.
1 comment:
Thanks for a great post. I really enjoy reading about the housing markets ups and downs.
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