Garganas sees inflation worries in the eurozone
FRANKFURT (Reuters) – Eurozone inflation pressures remain on the upside despite the recent rise in the euro, European Central Bank Governing Council member Nicholas Garganas said in comments reported yesterday. Garganas told news agency Bloomberg that the main drivers of inflation were domestic and that the ECB would continue to act in a firm and timely way to head off price risks, keeping alive the prospect of a further interest rate rise. «The upside risks to inflation dominate any effects stemming from the appreciation of the euro,» he was quoted as saying. Inflation in the 13-nation region has been below the ECB’s 2 percent ceiling for 12 straight months but is expected to pick up from September. «Given the financial market turbulence and the uncertainty of recent weeks, it remains appropriate to continue to pay close attention to developments to gather more information to assess the incoming data before taking possible action,» he said. «Ultimately what matters for investments and spending on consumer durables are rates on longer-term instruments,» he said.
