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<img src = "https://www.investor.bg/images/photos/0264/0000264358-article3.jpg" alt = "Novotni: The ECB fears that war will become a currency [Eugene Novotni]. A possible global trade war could become commonplace, given the rising dollar and the weakening of the Chinese yuan, said Monday one of the oldest members of the ECB, Evald Novotni. "In addition to the trade war, we can also witness a kind of currency war, even if it is not deliberate," he said at a conference in Zurich, reported Wall Street Journal In this regard, Evald Novotny pointed out that the ECB had no mandate to control the exchange rate of the euro and, in view of this, the central bank could not do part of a possible currency war.
The ECB representative suggested that the current increase in customs duties e between the United States and the European Union should not have undue negative impact on the results of the economy of the euro area. "The risks of a trade war seem less dramatic than at first glance," Novotni said, adding that the emergence of a currency dispute as a result of the trade war could have a more serious effect. "The current situation is not so dramatic, but it can escalate," he warned, adding that Europe no longer threatened the continued decline in prices, known as deflation. According to him, price stability means that inflation in the euro area is close to the ECB's medium-term goal of just under 2%. He pointed out that consumer prices are moving in the right direction and added that there could be a rise in inflation above 2% a month or two due to rising oil prices . on Brexit and limited production capacity are major risks for the euro zone economy Evald Novotny stressed that the European Central Bank would adopt a wait-and-see approach to any tightening of monetary policy, the ECB has decided to keep its negative interest rates unchanged at least until the summer of 2019.
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