It is not ideal to have a “global oligopoly” of three ratings agencies, Trichet says. In recent weeks there has been talk of the ECB doing its own country ratings, rather than rely on the ratings agencies…

Inflation is not the answer to solving high government debt, the central banker says. He also refused to answer a question on a country being forced out of the euro zone, calling it an absurd hypothesis.

Looks like ECB chief economist Stark was a bit hasty in dismissing the idea of a European monetary fund last week. He now says there are elements that need to be studied in more detail.

The eurozone is still in recovery, according to ECB chief economist Juergen Stark. He sees inflation at around 1% in the near-term and to remain subdued over the policy-relevant horizon. It is important that non-standard measures do not remain in place longer than necessary. Not surprisingly the former Bundesbanker is opposed to the IMF proposal to raise inflation targets, saying it would be a serious mistake.

EUR/USD is consolidating gains after a push as high as 1.3745. It trades now at 1.3736 as Stark signals the ECB is in no hurry to hike rates anytime soon.

ECB managing board member Bini-Smaghi says the euro zone needs an emergency mechanism as a last resort to deal with situations like Greece.

That said, the challenges facing the euro zone are not worse than those facing the US or Japan, he says.

Ministers acted too late and haven’t been strict enough with Greece. The Stability and Growth Pact should be stricter and fixed, he says.

Markets are testing the euro zone decisiveness over Greece, Bibi-Smaghi observed.

The Euro will survive and no country will want to get rid of it, he says.

He says it is wrong to bring the IMF into the picture when the Stability Pact did work as intended.

The eurozone needs a financial mechanism to be ready for an attack on the euro, he says.

What about of attacks from within, Lorenzo?

Not much reaction to the comments as the market grows tired of the whole sordid affair of European sausage-making… I do get a kick out of Bini-Smaghi’s comments on European decisiveness. This episode has shown anything but…

• Many measures have a natural expiry date
• Governments need to be ambitious and make credible fiscal plans

Gonzalez-Paramo is a member of the Executive Board of the ECB in Frankfurt.

Elsewhere, ECB’s Gonzalez-Paramo

• Markets have anticipated exit strategies well so far
• Euro zone inflation to be just above 1% this year

Trichet repeats that the ECB does not want to breed dependency by the banks on cheap credit and that the ECB will continue to phase out its non-standard monetary measures.

No reaction from the market with EUR/USD steady at 1.3762 as the market wraps up for the week.

All industrialized nations have taken a hit as a result of the financial crisis and all have to take care of their fiscal situation. Instability still exists for all countries and the financial system as a whole, he tells Fox Business.

Regarding inflation, Trichet says prices will likely be at levels that the ECB defines as price stability (just less than 2%).

The Euro inspires confidence and is not in a battle with the dollar, the central banker says.

Trichet says the idea of a EMF deserves examination. Interest rates are appropriate at this time but he warns against a prolonged period of non-standard measures.

• Will take two to three years until recovery complete

ECB executive board member Tumpell-Gugerell says that the euro is not a one-way street and Greece must make good on its reform plans.

Sounds like she is from the “show-me” state of Missouri rather than Austria…

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