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Ecb Decides To Remember It's Price Stability Mandate

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http://www.telegraph.co.uk/finance/economics/interestrates/8258019/Eurozone-rates-held-but-Jean-Claude-Trichet-turns-more-hawkish.html

The bank's president Jean-Claude Trichet said evidence of "short-term" upward pressures on prices, mostly due to the cost of energy, had not "so far" affected the bank's view on price stability but required "very close monitoring".

The move marked a turning point in attitudes at the bank from a neutral stance to a leaning towards more tightening, although it left interest rates still at a record low of 1pc on Thursday.

"Just when everyone thought that Mr Trichet would spend little time in discussing monetary policy ... he proceeds to drop a rate bombshell," said Marc Ostwald, a strategist at Monument Securities.

"Make no mistake, the rather explicit threat on Euro area rates if the 'temporary rise in inflation' proves to be rather more trenchant is not an idle one."

Economists at Citi now expect a rate rise in the second half of this year – probably before Mr Trichet's term ends on October 31 – rather than the start of 2012. The euro rose 0.89p to 84.11p.

Carry on ECB.

Nice to see the ECB remember it's price stability mandate, clearly hot air as increasing the interest rates will sink the Euro banks and probably trigger the collapse of those nations who've joined the EU and borrowed in Euro's against their own currency.

Still I'm sure it's all contained, Trichet is a central banker of the highest calibre.

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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