Garganas says ECB will control inflation

The ECB will do what is needed to ensure price stability in the eurozone, European Central Bank Governing Council member Nicholas Garganas.

"Although inflation in the eurozone is expected to rise in the next months, it is projected to ease during 2008. However, inflation risks have increased and the ECB will do whatever is necessary so that inflation expectations are stabilised at levels in line with price stability," Mr Garganas told the Greek Sunday newspaper Kathimerini .

Mr Garganas, who heads the Bank of Greece, told the paper the ECB's decisions so far have been based on a very thorough evaluation of data.

"As regards specific moves, I must repeat that we never preset our monetary policy decisions. We always examine all new data and then we decide whether a certain move is necessary."

Mr Garganas said turbulence in international financial markets may continue in the next months but that eurozone prospects remained "basically favourable."

"Corporate and household balance sheets are basically healthy, while the banking system as a whole has a satisfactory capital adequacy," he said.

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