MercoPress. South Atlantic News Agency

G-10 bankers committed to keep inflation “low”

The Central Banks of the ten leading industrial countries of the world warned that the strong surge in oil prices will slow global economic growth.

Jean Claude Trichet president of the European Central Bank and spokesperson for the G-10 said that "without any doubt", oil prices will decrease world economic activity and spur inflation rates.

However Mr. Trichet also pointed out that the world economy "keeps growing with dynamism", and revealed that for Central bankers the surge in oil prices has been caused by the strength of demand.

Mr. Trichet and colleagues met in Basel, Switzerland at the International Settlements Bank to consider the world economy situation and reached a consensus to ensure that "inflation rates remain low".

High oil prices cut into corporations profits or forces them to pass the increase on to retail prices, while pushing energy prices leaving consumers with less disposable income.

Central bankers reiterated their March call for a greater functionality and transparency in oil markets, both at producers and consumers end.

Because of the uncertainty surrounding oil and energy markets, Mr. Trichet recently forecasted lower growth expectations for the Euro Zone, in the range of 1 to 1,6%.