ECB: Inflation pressures strengthening, broadening

Economy 10/11/2018, 2:22 PM
ECB: Inflation pressures strengthening, broadening

The significant widening of spreads of Argentina’s and Turkey's sovereign bonds against benchmarks resulted in "only limited" contagion, rate-setters in Frankfurt wrote in the minutes of their last meeting. The document published on Thursday revealed the European Central Bank has stressed "the overall robustness of economic activity" and resilience, with cost pressures "strengthening and broadening." In conclusions from the event which ended on September 13, "a remark was made" that two consecutive downward corrections to economic growth indicate they weren't "entirely of a transitory nature."

Against the backdrop of a strong momentum, risks were seen as balanced but some attention was also given to downward-pointing factors. Trade tensions have the potential to "a more general decline in confidence" on a global scale, as some headwinds have been noted in commerce, warranting caution about external developments, ECB said.

"Equity prices had fallen in the light of heightened geopolitical and trade tensions. Moreover, the euro’s nominal effective exchange rate had appreciated, although this was mainly due to a weakening of a few emerging market economies' currencies," policymakers asserted.

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