LONDON (MNI) – Austrian National Bank President Ewald Nowotny today
warned that higher oil prices could have a negative effect on Eurozone
growth prospects.
Nowotny told a conference here that “certain disturbing
developments” in the middle east could have negative effects on the zone
which is already facing a ‘mild recession’ in 2012.
Because the European Central Bank focuses on headline rather than
core inflation in terms of its price stability mandate, Nowotny said
this makes “life a bit more difficult”.
Nowotny said it was his “personal view” that there was “not much
merit” in taking the key ECB refi rate below 1 percent – especially “at
the present time”.
Turning to the 3-year LTRO, the second of which is launched today
by the ECB, Nowotny echoed comments from ECB Chief Mario Draghi, saying
that the second such operation “will have a very important role to play
for the real economy”.
Nowotny also said it was important that central banks thought
through exit strategies on such special measures and that it wasn’t
assumed that such steps would continue indefinitely.
–London Bureau; Tel: +442078627491; Email: dthomas@marketnews.com
[TOPICS: M$X$$$,M$$EC$]
