ECONOMY

In Brief

Papademos sees no benefit in a more relaxed ECB stance on inflation European Central Bank Vice President Lucas Papademos said yesterday that raising the ECB’s inflation target to 3 or 4 percent will not provide more room for growth in the eurozone. «The empirical evidence overwhelmingly shows that on a long-term basis, one cannot expect to gain a higher rate of growth by accepting a higher rate of inflation,» Papademos said in response to a question at a conference on economic policy and the new sources of growth in Europe. The ECB is currently reviewing its monetary strategy, which involves monitoring money supply, setting a 2 percent inflation ceiling and reviewing all macroeconomic data. Papademos added that he did not believe low inflation and low interest rates are hurting the effectiveness of the ECB’s monetary policy moves to stimulate demand. Earlier, Papademos had said that the strengthening euro should not undermine the ECB’s forecast of growth of about 1.5 percent this year. «The euro may contribute to dampening exports growth, but it should not fundamentally affect the central scenario for growth, because the price competitiveness of the eurozone remains stable,» the central banker said. (Reuters) CPI estimated to have slowed down to a 3 percent pace at end-January Headline annual inflation is seen dropping sharply in January to 3 percent, slowing for the third month in a row, primarily due to lower food prices, analysts said. Greek inflation, one of the highest in the eurozone, slowed to 3.4 percent in December from 3.6 percent in November. «I see inflation easing to 3 percent. This is mainly due to base effects connected to food prices; there was a big spike in January last year,» said Christos Avraamides, economist at Proton Bank. «This year, we also had larger proportionate discounts offered during the winter sales period,» he said. The National Statistics Service is due to publish January inflation data on Monday. Greece’s EU-harmonized inflation – the figure used by the European Union in its calculations – slowed to 3.5 percent last month from 3.9 percent but was still the third highest in the 15-nation bloc. Eurostat, the European Union’s statistics office, estimates that eurozone inflation in January dipped to 2.1 percent year-on-year from 2.3 percent. (Reuters) Olympic catering Athens 2004, the Olympics organizers, yesterday announced they had picked US food service company Aramark and Greek hotel group Daskalantonakis to provide food services during the Games. Athens 2004 said the consortium prevailed in a tender with an offer of 33.9 million euros ($36.47 million). It will feed an estimated 23,000 athletes and team officials at the Olympic Village and participants in the Paralympics. Philadelphia-based Aramark Corp. is a leading provider of managed food services with experience in 11 previous Olympic Games. In 2001 it had sales of about $7.8 billion. The Daskalantonakis group, along with German tour operator TUI, runs the Grecotel chain in Greece. Decline The average occupancy rate of Athens’s luxury hotels fell to 40.54 percent in 2002, from 45.55 percent in 2001, according to data provided by the Attica Hoteliers Association.