VIENNA (MNI) – The crisis that struck the Eurozone banking sector
is generally over, which means that “the crisis modus we were in is no
longer necessary,” European Central Bank Governing Council member Ewald
Nowotny said on Thursday.
“We will leave it step-by-step,” he said at a press conference
here. “The interest rate was hiked and we will have to continue this
discussion.”
Noting the strong oil price increases in both 2010 and 2011, the
Austrian National Bank head did not expect that same jumps next year.
“We will still see high oil prices but there will not be a
similarly high increase which means there will be less of a basis
effect on the inflation rate,” he said.
The central banker also said that while the ECB’s medium-term
inflation target needn’t be achieved every month, price developments
still needed to be “watched carefully and with caution.”
“We have to avoid the inflation expectations changing,” Nowotny
said. “The quantitative outlook for that is something we will discuss at
the next ECB-meeting at the beginning of the next month.”
Turning to growth, he noted that Germany has turned into the
“growth engine” for the Eurozone. However, not all countries have been
so fortunate.
“Other countries have a very unsatisfactory economic development,
in some cases a negative one, which is a major challenge,” Nowotny said.
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