Dublin, 21/06/2001 (Agence Europe) - The ECB Board of Governors decided, on Thursday, to maintain its rates unchanged, decision expected due to the recent inflationary pressures that limit its margin for manoeuvre (see EUROPE of 16 June, p.15 and 18/19 June, p.15). However, this decision disappointed those who called for a monetary easing to support economic activity in Europe. The minimum bid rate on the main refinancing operations in the Euro zone also remains at 4.50% (after the 25 basis points fall decided on 10 May) and the marginal lending facility and the deposit facility that frame it remain respectively at 5.50% and 3.50%.
Commenting on this decision taken during one of the meetings, which take place regularly outside the seat of the ECB in Frankfurt the bank President, Wim Duisenberg repeated that his institution considers inflation as a "temporary" phenomenon, and that it is not concerned by the possible repercussions of the weak Euro on prices. The ECB also forecasts a return of inflation in the Euro zone "under the 2% target as of 2002". He nevertheless called on the Euro zone governments to do there utmost to ensure price stability, in particular with regards to monetary mass, GDP growth, price changes and that of interest rates. With regards to the ECB monetary policy, Mr Duisenberg underlined that it is obvious that the Board of Governors may only pursue one objective, maintaining price stability in the Euro zone. To do this it must adopt a view covering the entire Euro zone, when its assesses the economic conditions and the forecasts covering price stability, he said. A common monetary policy for the group of 12 countries does not necessarily entail the same economic development in all these countries, he felt, while calling on the Member States to should wage moderation.