Thursday 15 November 2007

Liikanen : "CHALLENGING SITUATION"


ECB Credibility?:

"Inflation expectations are on the upside," Liikanen said in a Finnish television interview.

"He cited oil and food prices as well as tax increases and high wage deals as contributing to inflation risks, and said the ECB now faces 'a challenging situation'."

"Above all (it is important) that inflation expectations are anchored at close to but below 2 percent. The central bank will stick to this," Liikanen said.


Stagflation?:

"The ECB faces conflicting pressures in the form of rising inflation and a deteriorating picture for economic growth, which has been hurt by the credit crunch that hit financial markets over the summer."

"Higher market interest rates after a global credit squeeze are lowering consumption and investment," Liikanen said.
Source: Guardian

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