European Central Bank council
member and Bank of Finland Governor Erkki Liikanen said monetary
policy ensures that temporary inflation pressures don’t fuel
broader wage and price increases.
“Temporary inflationary pressures should not have second-
round effects,” Liikanen said in a statement accompanying the
Bank of Finland’s latest forecasts published in Helsinki today.
“Monetary policy ensures that inflation expectations remain
firmly anchored and that broad-based inflationary pressures do
not materialize.”
The Bank of Finland noted that the ECB on March 3 said
“strong vigilance” is warranted on inflation, a signal that an
interest-rate increase is imminent. While Europe “will continue
to see sluggish economic growth in the coming years,” euro-area
inflation “may rise faster than expected” if surging food
costs start to drive up consumer prices, the bank said.
It said the natural disaster in Japan “poses a new threat
not only for the Japanese economy but for the global economy as
a while.” At the same time, the economic impact is hard to
estimate at the moment, it said.
Liikanen also said the global economy and world trade will
continue to grow “fairly quickly, but at a very different pace
in different regions.”
“Emerging economies’ share of the global economy will
overtake the advanced economies toward the end of the forecast
period,” he said. The forecasts extend through 2013.
To contact the reporter on this story:
Diana ben-Aaron in Helsinki at
dbenaaron1@bloomberg.net
To contact the editor responsible for this story:
Vidya Root in Paris at vroot@bloomberg.net
Sorry! This article is unable to leave response!