No Interest Rate Rises Forcast
The European Central Bank (ECB) will not raise interest rates again this year and is unlikely to cut rates until the end of 2008, a senior European investment manager said yesterday.
William De Vijlder, managing director and chief investment officer of Fortis Investments, said rates were unlikely to rise above their current level of 4 per cent while inflation in Europe remained at 2 per cent.
He said inflation would have to rise to 2.25 per cent or there would need to be an external crisis before the ECB needed to move on rates.
He could not understand why the ECB would raise rates when banks were being forced to increase their own rates due to the high cost of inter-bank borrowing.
He expected the US dollar to fall to €1.50 in the first half of next year. Eurozone growth had peaked, and the ECB now had a less upbeat economic outlook.
Read The Full Article at Ireland.Com
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