European Central Bank Not to Change its Percent Rate: British Company
Azerbaijan, Baku, 4 September / Trend corr. A.Badalova/ British leading independent macroeconomic research consultancy Capital Economics forecasts no change in the percent rate of European Zone.
Next meeting of the European Central Bank (ECB) will take place on 4 September. For the first time since 2007 ECB increased at the July meeting its percent rate by 0.25% in order to restrain inflation. ECB's current percent rate totals 4.25% - maximum within latest seven years. ECB's target inflation level is 2%.
According to Capital Economics, ECB is still quite concerned about increased inflation risks, and the business decline in European Zone rules out a possibility for increase in ECB's percent rate.
"In spite of recent business decline, which confirmed our forecasts for rapid percent rate cut in 2009, several months will pass before ECB will act," Capital Economics said.
According to the company, ECB's percent rate will fall to 3% in 2009.
According to outline reports of the European Statistics Committee, year-on-year inflation in the European Zone totalled 3.8% in August 2008 and 4.1% in July 2008.
According to Organisation for Economic Cooperation and Development (OECD), economic growth in the European Zone will comprise 1.3% in 2008. Previously, the economic growth had been forecasted in the region as 1.7%.
The correspondent can be contacted at [email protected]