Do Europeans still see high inflation with a strong Euro?
*Forbes, by Vidya Ram, March 6, 2008
Inflation Keeps Europe On Hold
“The European Central Bank joined the Bank of England in shrugging off mounting pressure to cut interest rates, as spiraling food and oil prices kept inflation high.
The ECB kept interest rates at 4.00% on Thursday afternoon, while the Bank of England also kept them on hold, at 5.25%. The news had little impact on European markets, as a stream of data over the past week pointed towards the decision. However, the euro had risen sharply against the dollar in Europe, ahead of the ECB’s decision, to $1.5324, after trading at $1.5265 in New York late on Wednesday.
Unlike the Federal Reserve, which has slashed interest rates to 3.0%, the European Central Bank has faced the unpleasant task of balancing rising inflation with a slowdown in growth.”
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