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ECB President Jean-Claude Trichet spoke in Budapest on Monday, regarding the ECB’s monetary policies. Remarks made by Trichet have indicated that interest rates, which were expected to rise in September, may not after all. Nicolas Sarkozy, President of France, has noted Trichet’s comments “interesting”.
Trichet remarked that :"The net assessment of the governing council will be made on September 6. We will then all together have to assess all elements of European and global finance. We are never pre-committed."
After a statement on August 2nd from ECB that it had adopted a stance of “strong vigilance” regarding inflation, interest rates have been expected to increase beginning early in September. There had been an agreement between the president of the republic and the prime minister that emphasizes the interest of France in encouraging the debates.
With the recent cut in the US discount rate, Sarkozy has stated :"Can we deprive ourselves of the weapon of interest rates in the face of a crisis such as we are experiencing at the moment?" Only time will tell if ECB indeed increases interest rates. With the beginning of September looming in the near distance, it’s a safe assumption that something will be worked out soon.
14:43
Posted on Dec-14-2007
