miércoles, 18 de julio de 2012
I.M.F. Warns of ‘Sizable Risk’ of Deflation in Euro ZoneBy JACK EWING
FRANKFURT — The International Monetary Fund warned Wednesday of “a sizable risk” of deflation in the euro zone, and called on the European Central Bank to begin buying huge amounts of government bonds to help hold down borrowing costs for troubled countries. In a report on the state of euro zone policy, I.M.F. staff said there was a 25 percent risk of consumer price deflation before 2014, and that the danger was greatest in countries like Italy where growth is slow and tax increases have made inflation appear higher than it really is. Deflation, a destructive decline in prices that can be extremely difficult to reverse, would make it even harder for countries like Greece, Italy and Spain to get government debt under control, the I.M.F. said, because falling prices and wages would further depress tax receipts. The warning came as part of a report on euro zone policies in which the I.M.F. again criticized European leaders for the way they have handled the euro crisis. “The deepening of the crisis suggests that its root causes remain unaddressed,” the I.M.F. said. It faulted what it said was a lack of “ambitious policies to restore strong and balanced growth across the euro area.” “The viability of the monetary union itself” is in doubt, the I.M.F. said. The I.M.F. praised progress made by European leaders in recent weeks to create a banking union with a central regulator, which it said would help prevent national regulators from pursuing policies designed to protect their banks at the expense of other countries. Common bank supervision “allows banks to be guided by European or euro area considerations,” Mahmood Pradhan, deputy director of the European Department at the I.M.F., said during a conference call with reporters Wednesday. But the I.M.F. said euro zone countries needed to go further, eventually issuing common debt and ceding some authority over their national finances. Germany and some other countries remain firmly opposed to common debt — so-called euro bonds — unless they have more control over spending by other euro zone countries. France and other countries are in favor of euro bonds but have not been willing to give up control over their own budgets. Government bond purchases by the E.C.B. would be a way to fight deflation while also holding down borrowing costs for euro zone nations. But so-called quantitative easing probably would stir outrage in Germany, since it would amount to use of the E.C.B. to finance governments. Helge Berger, an advisor in the I.M.F. European Department, said that quantitative easing would not violate the E.C.B.’s charter because it would be designed to maintain the central bank’s control over interest rates. “It is an essential part of the E.C.B. fulfilling its mandate,” he said during the conference call. The E.C.B. has purchased limited amounts of government bonds but has so far resisted calls for it to mimic the huge purchases made by the U.S. Federal Reserve and the Bank of England in their respective countries. After the E.C.B. cut its benchmark interest rate below 1 percent for the first time earlier this month, though, speculation has risen that the central bank might have to resort to quantitative easing if the euro crisis continues to worsen. Mario Draghi, the president of the E.C.B., seemed to open the door a crack to quantitative easing when he noted early in July that the bank’s mandate requires it to defend price stability “in both directions” — in other words, to fight deflation as well as inflation. A version of this article appeared in print on July 19, 2012, in The International Herald Tribune..