WASHINGTON, Oct 11 (Reuters) - Falling euro zone inflation and stabilising inflation expectations could make room for an interest rate cut by the European Central Bank, Economic and Monetary Affairs Commissioner Joaquin Almunia said on Saturday.
'Supported by the easing of commodity prices, the presently high inflation is on a downward trend and long-term inflation expectations are stabilising at a lower level consistent with price stability,' Almunia said in a statement.
'If confirmed, these new developments could justify some monetary easing in the near-term,' he said in a rare reference to ECB monetary policy at the annual meeting of the International Monetary Fund and the World Bank.
The ECB cut rates by 0.5 percentage point to 3.75 percent together with other major central banks on Wednesday and economists expect more could be in the pipeline.
ECB Governing council member Christian Noyer also hinted at such a possibility on Friday by saying that inflation in the 15 countries using the euro would fall below the bank's target of just below 2 percent in mid-2009.
Euro zone inflation was 3.6 percent year-on-year in September, down from 3.8 percent in August.
(Reporting by Jan Strupczewski, Editing by Chizu Nomiyama) Keywords: FINANCIAL/EUROPE tf.TFN-Europe_newsdesk@thomson.com ak COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
'Supported by the easing of commodity prices, the presently high inflation is on a downward trend and long-term inflation expectations are stabilising at a lower level consistent with price stability,' Almunia said in a statement.
'If confirmed, these new developments could justify some monetary easing in the near-term,' he said in a rare reference to ECB monetary policy at the annual meeting of the International Monetary Fund and the World Bank.
The ECB cut rates by 0.5 percentage point to 3.75 percent together with other major central banks on Wednesday and economists expect more could be in the pipeline.
ECB Governing council member Christian Noyer also hinted at such a possibility on Friday by saying that inflation in the 15 countries using the euro would fall below the bank's target of just below 2 percent in mid-2009.
Euro zone inflation was 3.6 percent year-on-year in September, down from 3.8 percent in August.
(Reporting by Jan Strupczewski, Editing by Chizu Nomiyama) Keywords: FINANCIAL/EUROPE tf.TFN-Europe_newsdesk@thomson.com ak COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.