[autom.vertaling] ECB nu klaar om rentevoeten op te heffen, zegt Trichet (en)

Jean-Claude Trichet indicated to MEPs on Monday that the European Central Bank was poised to raise interest rates to safeguard price stability. While the ECB would always do what was necessary to combat inflation, there were no advance plans for a series of rate rises, the ECB President said at the latest session of 'monetary dialogue' with the Economic and Monetary Affairs Committee.

He told the committee that, "After two and a half year of maintaining interest rates at a level historically exceptionally low, I would consider that the Governing Council is ready to take a decision to move interest rates, and to moderately augment the level of ECB rates (...) in order to maintain and preserve full confidence in price stability and to continue solidly anchoring inflation expectations."

In his opening statement, he said that recent data showed the ECB was right to predict a gradual ongoing strengthening of economic activity. Growth in global demand should continue to support euro area exports, while consumption should gradually recover. There were downward risks related to oil prices, global imbalances and weak consumer confidence. On prices, he said HICP inflation was likely to remain elevated in the short term, with markets expecting oil prices to remain high. "Concerns exist about the medium term upside risks," he said. "Monetary analysis also points to increased upside risks to price stability. Liquidity in the euro area is very ample in terms of all plausible measures... the growth of credit remains very robust."  He stressed that no significant progress had been made in reducing excessive government deficits, with the outlook being "a matter of great concern." He emphasised the need to increase the flexibility of labour and product markets to achieve a more dynamic economy. Finally, he set out details of the ECB's first annual report on financial integration in the euro area. (See the link below for the full text of the opening statement.)

A number of MEPs were concerned about the effects of a rate rise: "This is a sad day for millions of Europeans," said Cristobal Montoro Romero (EPP-ED, ES). Committee Chair Pervenche Berès (PES, FR) raised worries that, without rising oil prices, some economies were already close to deflation and that growth was fragile. Eoin Ryan (UEN, IE) asked if it was not simply too soon to raise rates. Mr Trichet was emphatic: "The 311 million people of the euro area ask us to be vigilant and to guarantee price stability. All the polls show us this. We have had rates at 2 per cent for a long time; it was very bold to go that low, lower that any rate set by the Bundesbank since World War 2. We could do it because we were credible in the eyes of Europe and the markets. If we do not maintain our credibility, rates would rise very quickly."  He stressed that the ECB was aiming at prevention, since if it waited until risks had materialised, it would be too late and a painful cure would be unavoidable. Being faithful to its price stability mandate, he said, was the best way for the ECB to support growth and job creation.

In response to Sahra Wagenknecht's (GUE/NGL, DE) point that inflation was more varied between sectors that in the past, the ECB President set out four signs of increasing inflationary risks: the headline rate had been above target over a long period, monetary aggregates were rising robustly, real interest rates were now slightly negative and analysis of inflationary expectations showed them tending to rise.

On the other hand, he said, "I do not see ex-ante the start of a series of interest rate rises. We have always seen ECB rates to be in line with the level appropriate for price stability. There is no process of 'catching up' in our concept. But we will do what is necessary."

Two questions - from Ieke van den Burg (PES, NL) on the duty of banks to boost investment levels, and from Gunnar Hökmark (EPP-ED, SE) on whether this tightening of policy meant current modest growth levels were the best Europe could hope for - led Mr Trichet to stress the need for confidence: "Now is the time to invest. The environment is exceptionally favourable. Householders and enterprises can have confidence in stability. The ECB is the anchor, guardian and guarantee of stability and confidence (...) With the same fundamentals and just a little bit more confidence among businesses and households we would do much better."

Several MEPs, including Karsten Friedrich Hoppenstedt (EPP-ED, DE), Wolf Klinz (ALDE, DE) and Sophia in 't Veld (ALDE, NL), raised the plans of the incoming German government, notably for an increase in VAT. Mr Trichet said he was not going to award marks to individual policies, but "for me, any policy which aims to reduce deficits is good, as is, in many Member States, a reduction in the public sector share of GDP, which will increase competitiveness." 

21/11/2005

Committee on Economic and Monetary Affairs

In the chair : Pervenche Berès (PES, FR)

Committee on Economic and Monetary Affairs

Monetary Dialogue with the European Central Bank