PARIS (MNI) – The recent sharp selloff of commodity prices,
including oil, is “good news” for the economic recovery and for price
stability, European Central Bank President Jean-Claude Trichet said in a
snippet of an interview broadcast by CNBC.
Trichet noted that lower commodities prices would be a boon for the
recovery, but he tempered his comment by cautioning that what counted
was the longer-term trend.
The ECB has returned in recent months to a tightening mode as
inflation pressures mount, largely on the back of soaring commodities
prices. The ECB last month became the first industrial-nation central
bank to raise interest rates following the financial crisis, and it
cited mounting inflation pressures tied largely to commodities.
Headline inflation in the Eurozone rose unexpectedly sharply to
2.8% in April, sparking speculation that the ECB would opt for an early
followup to its first interest rate hike. Trichet on Thursday poured
cold water on the idea of another hike in June, but left the possibility
very much open for July.
CNBC said a larger chunk of the Trichet interview will be broadcast
at 1015 GMT/0615 EDT.
–Paris newsroom, +331-42-71-55-40; bwolfson@marketnews.com
[TOPICS: M$$EC$,M$X$$$,MGX$$$,M$$CR$]
