ECB president signals further rate rise

THE European Central Bank left interest rates steady yesterday and said it remains on high alert in the fight against inflation, a signal markets understood to mean another rate rise next month.

ECB President Jean-Claude Trichet warned that inflation, now hovering around 1.7%-1.9%, may be only temporarily lower and upward price pressures will intensify later this year, feeding speculation the ECB will keep hiking after March.

“Strong vigilance remains of the essence so as to ensure that risks to price stability over the medium term do not materialise,” he said, presenting the ECB’s monthly policy statement.