Garganas defends ECB

Bank of Greece Governor and European Central Bank (ECB) Governing Council member Nicholas Garganas yesterday defended the ECB’s reluctance to further cut official rates below their present historic lows. «We are achieving our inflation target and therefore have no reason to move. If there is any change, then we should be free and not pre-committed in one direction or another over the medium term,» he told Reuters in an interview on Monday. He said the issue of a rate cut was no longer relevant as a strengthening global economy is lifting the eurozone into a sustainable growth path. «As long as growth in the rest of the world continues to be buoyant, I would not worry very much about developments in the euro area,» Garganas said. He said the outlook is that growth will propel real disposable incomes and employment and that this will help private spending pick up further. Although everyone expects oil prices to decline, they are still an uncertainty and this required ECB to be «vigilant» and monitor developments «very carefully.»