Belgian National Bank sees ECB rates rising in line with market views

by : Thomson Financial
Forex News

(Updates with oil price, euro level assumptions)

BRUSSELS (Thomson Financial) - The Belgian National Bank sees the European Central Bank raising interest rates in line with the expectations of the market.In its latest set of economic forecasts, the central bank said: 'Interest rates are ... projected to rise in line with market expectations.'Bank governor Guy Quaden told reporters: 'Monetary policy is not restrictive nor negative for sustained activity and investment.'He said that the ECB's rate-setting 'governing council has not said that the tightening cycle has ended, nor that a new hike is necessary'. Quaden added: 'Two years ago rates were exceptionally low. Now at 4 pct in nominal terms and 2 in real terms our monetary policy is not restrictive.'After the ECB raised its main refinancing rate to 4.00 pct from 3.75 pct last Wednesday, president Jean-Claude Trichet signalled that the bank has not yet ended its tightening cycle.Otherwise, the Belgian central bank said oil prices 'are forecast to rise slightly again during the course of 2007 before levelling out at an average of 69.9 usd a barrel in 2008'.Exchange rates are see remaining 'constant at their mid-May 2007 level, namely 1.36 usd to the euro'.