LUXEMBOURG (Reuters) – Eurozone finance ministers and the European Commission said yesterday they saw no sign of a jump in oil costs feeding into consumer prices and wages – a development the ECB has warned could trigger a rate rise. After a meeting with EU counterparts in Luxembourg, Germany’s Deputy Finance Minister Caio Koch-Weser said there had been a long discussion on Monday about the European Central Bank’s concerns about consumer prices being inflated by expensive oil. The ECB sees increasing risks of surging energy prices triggering higher wage demands and consequently inflation, but the ministers agreed there was currently no sign of that. «Quite the opposite,» Koch-Weser said at a news conference. «But of course we must remain vigilant, especially in countries which still have inflation-indexed wages like Spain.» The ECB earlier this year faced calls from eurozone politicians to cut interest rates to help boost economic growth. But pressure had eased in recent months as business confidence strengthened and surging oil prices put fresh upward pressure on prices. The ECB last week toughened its anti-inflation rhetoric, saying strong vigilance was required and it stood ready to raise interest rates should the situation deteriorate. A Reuters poll of 65 economists showed most expect a rate rise next year while markets are pricing in a 75 percent chance of a quarter-point hike, the first increase in almost three years, by the end of March 2006. No swift action Comments from EU finance ministers in Luxembourg showed they agreed the ECB should not rush to tighten credit. Austrian Finance Minister Karl-Heinz Grasser said politicians had a right to contribute to the debate on inflation and that there was wide agreement that there was no current danger of second-round effects. EU Monetary Affairs Commissioner Joaquin Almunia agreed, saying yesterday, «Our analysis is that oil price gains are not feeding through into wages.» ECB President Jean-Claude Trichet, who attended Monday’s Eurogroup meeting, said last Thursday the bank’s governing council discussed tightening borrowing costs at their monthly meeting but decided that the current 2 percent level of its key lending rate was appropriate for now. German Economy Minister Wolfgang Clement said on Sunday that current upside risks to price stability were a temporary phenomenon linked to surging oil prices and the ECB had no need to raise rates as a countermeasure. Koch-Weser said yesterday that inflation risks in Germany, Europe’s biggest economy, remained limited. «Core inflation remains very low. There is no danger of second-round effects in Germany,» he said. The European Commission had confirmed in Monday’s Eurogroup discussion on the economy that their central projection continued to be of a moderate strengthening of economic growth in the euro area in the second half, Koch-Weser said. EU finance ministers also took steps yesterday to strengthen cross-border trade in financial services to help boost the bloc’s sluggish economy. But ministers also said the execution of planned measures would be key, and that other steps such as wider economic reforms would be needed to revive growth. Making trade in goods and services across the EU’s national borders easier for its 450 million citizens would help boost economic growth rates as the bloc struggles with an aging society, shrinking work force and global competition. Gordon Brown, finance minister of Britain which holds the EU presidency, said growth was slowing and it was time to act. Change «This is a sign of things changing in the European Union, that we are recognizing the drivers of growth for the future – economic reform, the importance of liberalization of markets within Europe, the sector investigations in energy and financial services, and importance of better trading relations with our partners,» Brown told reporters. Measures adopted included beefing up the ability of banks to withstand market shocks and improving the scrutiny of firms, both aimed at increasing investor confidence. Finance ministers also backed the executive European Commission’s plans to encourage workers to put money into funds across the EU for their pensions. «The emphasis… is now on enforcement and moving forward with implementation and specific outcomes,» Brown said. Others also voiced the need to follow through on decisions. «Concerning the improvement of the internal market, I think all of us agree. The problem is the practical application is not always easy,» Spanish Finance Minister Pedro Solbes said. «We have to do everything we can for the internal market… It’s one of the ways to help boost growth – it is not the only one, but it is a good way,» the former EU economic affairs commissioner told reporters. Ministers discussed initial results of probes by the Commission into the market for insurance, retail banking and utilities to identify obstacles to Europe-wide competition, a move welcomed by Dutch Finance Minister Gerrit Zalm. «I think there are still some barriers… There should be a level playing field in Europe also for takeovers and mergers,» Zalm told reporters in an apparent reference to a recent battle by Spanish and Dutch banks to buy Italian banks. Cutting red tape was also a key priority. Brown urged the Commission to find and remove legislation that is not delivering any benefits for Europe’s financial services. The first set of rules adopted yesterday seeks to avoid bookkeeping scandals such as those involving Dutch retailer Ahold and Italian food group Parmalat. The rules lay down minimum requirements for auditing company accounts in a bid to avoid company fraud, and include provisions such as a demand for auditing firms to change the person who handles the audit of a company every seven years. Bankers welcome rules The second set of rules is known as the capital requirements directive and introduces globally agreed Basel II rules on covering banking risk across the EU. It also includes a set of rules on handling trading book risks. The British Bankers Association, International Swaps and Derivatives Association and London Investment Banking Association said the rules would ensure more efficient allocation of capital and reduce the chance and severity of banking crises in the EU. «Governments across the EU now have the not insubstantial task of implementing the directive,» the three associations said in a joint statement. Ministers also want to help financial services boost jobs by deepening ties with markets in the United States, offering EU banks a wider customer base and giving investors more choice. Transatlantic trade in goods and services is worth $600 billion a year.