Brussels, 10/10/2007 (Agence Europe) - Speaking before the committee on economic and monetary affairs of the European Parliament on Tuesday 9 October, Jean-Claude Trichet reiterated that he needed more information before he could take any decision on interest rates. His message remains unchanged since the recent decision of the Council of Governors to keep eurozone rates unchanged (EUROPE 9516). The risks concerning inflation are on the rise, but the uncertainty regarding growth is reinforced at the same time, said the president of the European Central Bank (ECB), who anticipates an annual inflation rate increase in excess of 2% in the next few months, to be followed by another fall.
On the exchange rates, Mr Trichet stuck, almost word for word, to the position defined and presented by the Eurogroup the day before (EUROPE 9519), particularly targeting China. “In the emerging countries which currently have large and increasing surpluses, as is the case with China, it would be preferable for their effective exchange rate to change, so that the necessary adjustments can be carried out”, he told the MEPs, who are particularly concerned about the level of the euro compared to the dollar. There are four concurrent initiatives to restore trust in the global credit market, continued Mr Trichet: reinforcing transparency and improving risk management; the assessment of the role of notary agencies; the revision of the regulatory framework; and a highly in-depth examination of non-regulated entities. Pointing out that “initiatives in global and European level are already on the right path to tackling these problems”, Mr Trichet added: “There is a common understanding on the need for finding solutions that can be applied consistently at a global level”. (ab)