[autom.vertaling] Trichet: de sterkere eurozonegroei, maar waakzaamheid over inflatie (en)

Jean-Claude Trichet told MEPs on Monday that eurozone growth should strengthen, but he repeatedly warned of the need for "vigilance" to maintain price stability and contain inflationary expectations. In the first session in 2006 of the quarterly monetary dialogue with the Economic and Monetary Affairs Committee, the ECB President also discussed eurozone enlargement.

On the prospects for economic activity, Mr Trichet said: "Looking ahead, the conditions remain in place for continued sustained economic expansion."  The external environment was supporting exports, investment was expected to remain strong and consumption growth should also strengthen over time. "However, the outlook for economic activity remains subject to downside risks relating, in particular, to high and volatile oil prices and concerns about global imbalances."

Vigilance on inflation

On inflation, he said "Risks ... remain on the upside and include further rises in oil prices, a stronger pass-through of oil prices into consumer prices than currently envisaged, additional increases in administered prices and indirect taxes, and - more fundamentally - potential second-round effects on wage and price-setting behaviour." He also said "strong monetary and credit growth in a context of already ample liquidity in the euro area points to risks to price stability over the medium to longer term."

"The Governing Council will exercise vigilance so as to continue ensuring the solid anchoring of medium to long-term inflation expectations at levels in line with price stability. Such vigilance is indeed warranted, taking into account the present upside risks to the outlook for price developments and the historically low level of both nominal and real short term interest rates," he said. He later added, "For the short period ahead of us, it seems that market sentiment is pretty much in line with what we would consider reasonable."  Mr Trichet also called for countries with excessive deficits to take advantage of higher growth to reduce their fiscal imbalances. He highlighted the benefits that should ensue from a fully integrated EU services market, not least in having " a dampening effect on prices."

Alexander Radwan (EPP-ED, DE) asked about the effect of wage demands on European competitiveness. Mr Trichet said that second round effects had not been observed - and "it is of utmost importance to continue not to observe them - they would destabilise the full body of the situation, augment inflationary expectations and these would be incorporated into medium and long term interest rates. We will do our job to maintain inflation and inflationary expectations and protect the purchasing power of salaries."

Praise for ECB Board candidate Stark

Ieke van den Burg (PES, NL) expressed frustration with the procedure for the replacement of ECB board member Otmar Issing, which she said had shown a big country claiming the position as if it owned it.  She asked about changes in portfolios on the executive board. The ECB President said the Council had unanimously nominated Juergen Stark to replace Mr Issing, and, while not wanting to pre-empt the ECB Council's assessment, stressed Mr Stark's qualities: "He is a remarkable person for an important position, with remarkable experience... I have the highest esteem for him personally." He said any change of portfolios would be for the six-member board to decide collectively after the new appointment was made.

Eurozone enlargement

Sophia in 't Veld (ALDE, NL), Margarita Starkevi?i?t? (ALDE, LT), Guntars Krasts (UEN, LV) and Dariusz Rosati (PES, PL) all raised the issue of enlargement of the eurozone, and in particular whether the inflation criterion could be met if prosperity in the new Member States was catching up with the EU15 - a reference to the so-called 'Balassa-Samuelson effect' based on the idea that consumer prices are higher in more prosperous countries. Mr Trichet repeatedly stated that he was not overly concerned: "In our research we see only a modest impact of this catching up effect. It is a meagre element, which does not put any doubt on the wisdom of the criteria as they exist."  He added that when it came to criteria for joining the euro, it was a matter of "the treaty, all the treaty and nothing but the treaty. The criteria must be met not only as a snapshot but on a sustainable basis."

20/02/2006

Committee on Economic and Monetary Affairs

Chair, Committee on Economic and Monetary Affairs : Pervenche Berès (PES, FR)

Monetary Dialogue with the European Central Bank