Global economy ticks upward, say central bankers

Wednesday, 12 January 2011 00:01 - - {{hitsCtrl.values.hits}}

BASEL: The global economy is recovering faster than expected, central bankers from leading nations said Monday, though they see dangers from rising food prices and other inflation in fast-growing markets .

The recovery is particularly strong in emerging economies such as China, Brazil and India, according to the group of central bankers that meets in Basel, Switzerland every other month to assess the world economy.

``At the level of the global economy the recovery is confirmed. Growth is there, particularly I have to say impressive in the emerging economies,’’ said Jean-Claude Trichet, the group’s chairman and chief of the European Central Bank, at a press conference.

``In a number of a cases the real economy has demonstrated the capacity to behave better than the previous forecast.’’

Among the developed economies, Europe has generally been lagging other regions due to market concerns about its heavy debt loads and gloomy growth outlook.

Trichet said the group finds the buoyancy of emerging markets to be particularly impressive where inflationary pressures are contained.

But he said record food prices could continue to spiral upward, posing a threat to the recovery, if crops suffer from bad weather.

``This is no time for complacency and the solid anchoring of inflation expectations is considered something that is important by all of us,’’ Trichet told reporters. ``We are all united in purpose.’’ The meeting of central bank governors chaired by Trichet is held on the sidelines of closed meetings by the Basel-based Bank for International Settlements. None of the other participants attended the press conference.