(ANSAmed) - ROME, JUN 16 - Bank of Italy Governor Vincenzo
Visco on Thursday told the Young Factor event in Milan that an
upcoming increase in interest rates by the European Central
Bank, expected next month, was aimed at keeping inflation in
check.
"We are raising interest rates to prevent the genius of
inflation from getting out of hand, with inflation expectations
growing in an uncontrolled way and, at the end, prices and
salaries chasing one another, which can only lead to a fall in
real incomes", the governor explained.
"Lately, we have registered a very strong increase in prices,
which is different between Europe and the United States",
explained Visco.
He recalled that the US Federal Reserve, "to contain a very
strong price increase, stimulated by excess in demand, is now
implementing a restrictive monetary policy". The Fed upped rates
by 0.75% Wednesday, its biggest hike since 1994.
Meanwhile the European Central Bank, "faced with price hikes
mainly due to an increase in energy costs", must intervene by
avoiding such costs to be transferred, eroding the purchasing
power of families, Visco said. (ANSAmed).
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