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15 April 2012

FT: Sarkozy breaks silence over ECB role


Nicolas Sarkozy broke a pact of months with Angela Merkel not to discuss the role of the European Central Bank in public, calling for the ECB to adopt policies to support growth.

Mr Sarkozy said: “If the central bank does not support growth, there will not be enough growth . . . I know the difficulties that surround this subject but we have the duty to reflect on it because it is a major problem for the future of Europe.” 

In effect ripping up a deal to shelve public differences over the ECB reached in November at the height of the eurozone crisis with Ms Merkel and Mario Monti, the Italian prime minister, Mr Sarkozy said the matter of ECB support for growth was “a question we cannot avoid”.  Mr Sarkozy said: “Europe must purge its debts, it has no choice. But between deflation and growth, it has no more choice. If Europe chooses deflation it will die. We, the French, will open the debate on the role of the central bank in the support of growth.” The unexpected move came as François Hollande, the Socialist candidate, urged his supporters at a rival event in a park in the east of the capital to “resist euphoria” despite his healthy lead over Mr Sarkozy in the opinion polls – and to “get out and vote”.

Mr Sarkozy’s move on the ECB was the latest step he has taken during the campaign to toughen his line on European issues that have put distance between himself and Ms Merkel, despite the close partnership they had built up. Paris and Berlin have long been at odds over the ECB, with France seeking more active intervention by the bank to support countries threatened by the sovereign debt crisis as well as looking to it to boost growth. By contrast, Germany has insisted the ECB stick strictly to its role in controlling inflation. 

Full article (FT subscription required)



© Financial Times


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