Global growth strong central bankers say (Toronto Star, 26 Jun 2006, Page C4)

Global growth strong central bankers say

Toronto Star
26 Jun 2006

BASEL, SWITZERLAND—
Interest rate hikes should help put the world economy on a sustainable growth path as inflationary expectations intensify, the head of the International Monetary Fund said yesterday. IMF Managing Director Rodrigo Rato, attending a threeday meeting of about 100 central bankers, said growth in the global economy was strong and should remain near 5 per cent this year and next despite monetary tightening by leading central banks.



“Monetary policy is becoming less accommodative and that is, I think, a welcome step that will make the overall macroeconomic framework more sustainable, but nevertheless will demand that markets and investors and consumers adapt themselves to higher interest rates,” Rato said. “The overall view of the global economy is one of strength,” he said on the sidelines of the annual general meeting for the Bank for International Settlements (BIS), the bank to the world’s central banks. The BIS plans to unveil its annual health report on the global economy and financial system today on the third and final day of the world’s largest gathering of central bankers.

Markets are likely to take their cues from the report on... read more...