FRANKFURT, March 4 (Reuters) - There is a danger of higher oil prices becoming entrenched in other prices, even though inflation expectations have remained anchored, European Central Bank Governing Council member Christian Noyer was quoted as saying on Friday.
“So far, inflation expectations have remained fairly well anchored, but we know that there are risks with having a number of months with an excessive inflation rate due to the cost of commodities and energy,” Noyer told news agency Bloomberg in a television interview, the transcript of which was published on the Bloomberg website.
“Some question marks start to arise that some pressure for second-round effects develops, some pass-through is being seen.”
Noyer also said the ECB would ensure that higher oil and commodity prices would not seep into the general price level.
“We need to reaffirm very strongly that we will never let that happen.”
Euro zone inflation accelerated to 2.4 percent last month, further above the ECB’s target of just below 2 percent and ECB President Jean-Claude Trichet said on Thursday the 17-country bloc’s central bank may raise interest rates next month from the current 1.0 percent. (Writing by Sakari Suoninen; Editing by Susan Fenton)