Brussels, 13/01/2005 (Agence Europe) - For the nineteenth month running, the European Central Bank (ECB) decided on Thursday not to change its interest rates. The minimum tender rate applied to refinancing operations remains 2%, the interest rate for the marginal loan facility 3% and that for the deposit facility 1%, Jean-Claude Trichet said after the Governing Council was held. "Rates are today those which best correspond to our mandate", the ECB President told the press, recalling the Frankfurt institute's aim of credibility. He felt that the situation of the euro zone was largely the same as one month ago, with the prospect of "moderate growth" (yesterday's EUROPE, p.15 and 16) and a confirmed fall in oil prices. On the inflation side, estimates for December 2004 are up at 2.3%, but this rate does not seem to worry the ECB which still expects it to fall below 2% "during 2005".
Jean-Claude Trichet refused to comment on the latest US trade deficit figures which have gone down somewhat compared to earlier months, but recognised that consolidation of any imbalance of this kind is "the concern of all". According to the figures announced on Wednesday, the US deficit was at more than $60 billion in November, causing a rise in the euro to $1.3280 compared to $1.3114 the day before. Mr Trichet simply specified that he trusted the comment made last week by John Snow, US Secretary for the Treasury, who reaffirmed that he wished to reduce American twin deficits (EUROPE of Wednesday 12 January, p.13). Each, on both sides of the Atlantic, must "do its share of the work", he recalled - the Europeans by making "structural reforms in order to heighten their growth potential" and the Americans by increasing spending. He went on to stress that this "vision is shared by the G10 colleagues".
In answer to questions on ECB results for 2004, Lucas Papademos admitted that the ECB will have losses but refused to say by how much. While speculators speak of a loss of over one billion euros (EUROPE of 12 January, p.12), the definitive results and figures will be approved by the Governing Council on 17 March, the Vice-President confirmed.
On the subject of relations between the ECB and the Eurogroup, Mr Trichet said he "agreed perfectly" with Jean-Claude Juncker who hopes to strengthen their dialogue (yesterday's EUROPE, p.15). The president of the Eurogroup (with Commission President José Manuel Barroso), attended the Governing Council, to which he presented the priorities of the Luxembourg EU Presidency. On the subject of clarifying the Stability and Growth Pact, Mr Trichet hoped discussions would come to a "convincing conclusion".