Comments by Nicolas Sarkozy - Independent Central Bank
From FXPedia
In the Spring of 2007 French President candidate Nicolas Sarkozy – himself a former French finance minister – voiced concerns during the election race that the ECB’s efforts to fight inflation that, in his words, did not exist, were forcing up interest rates unnecessarily and were causing the value of the euro to rise in the forex markets. The result, according to Sarkozy, was making it difficult for French exporters to compete in the face of global competition. Claiming that “Independence doesn’t mean indifference”, Sarkozy lobbied for a change to the Eurosystem charter that would enable governments to have more influence over the ECB in the setting of interest rates.
Reaction to Sarkozy’s comments came quickly from leaders of the Eurosystem countries who came out strongly on maintaining ECB independence. Greek finance minister George Alogoskoufis was perhaps the most blunt in his disagreement. “When we gave independence to the ECB we did it so politicians would not meddle with interest rate decisions.”
It was also noted that Sarkozy has toned his condemnations of the ECB down somewhat after successfully winning the election. As Governing Council member Alex Weber noted, Sarkozy’s remarks may have simply been “election bluster” and it does not appear that there is any momentum to consider limiting the ECB’s independence.
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