In a week in which key central bankers around the world signalled their intention to control inflationary pressures, the Bank of England on Thursday raised UK interest rates and the European Central Bank indicated it would move rates higher in June. The BoE increased its main interest rate by a quarter point to 5.5 per cent, a six-year high, citing strong investment. Jean-Claude Trichet, ECB president, committed the ECB to “strong vigilance” — a phrase understood to mean a rate rise is a month away. Eurozone interest rates are currently 3.75 per cent. With the US Federal Reserve on Wednesday reiterating its main concern that “inflation will fail to moderate as expected” and the Bank of Japan’s governor on Thursday making the case for gradual interest rate rises, the world’s big central banks have now indicated their focus will stay on inflation control. Meanwhile, Reuters reports that Alan Greenspan, former Fed chairman, said at a Singapore conference on Friday that the likelihood of a US recession had lessened, thanks to strong global economic growth.

This entry was posted by Gwen Robinson on Friday, May 11th, 2007 at 5:53 and is filed under Capital markets, People. Tagged with alan greenspan. Edit this entry.