Top central bankers believe world economic growth will continue this year at a similar pace to the encouraging levels achieved in 2006, according to European Central Bank chief Jean-Claude Trichet.
Trichet was speaking after chairing a regular meeting of the G10 group of top central bank governors in Basel in Switzerland. He declined to give a figure for growth in 2007. Global economic expansion came to 5.1% last year, according to the International Monetary Fund.
Trichet added a note of caution about the threat of protectionism if global trade talks collapsed, warning that 'it would be very damaging' to growth. The World Trade Organisation suspended stuttering negotiations on a new round of free trade arrangements covering agriculture, industrial goods and services last year because of deadlock among its 149 members.
At their last meeting in November 2006, the G10 central bankers predicted dynamic economic growth but called for vigilance against the threat of inflation caused by a possible resurgence in oil prices.
Today, Trichet said threats to growth from high oil and commodity prices as well as global imbalances also remained, but the probability of their occurrence was now 'low'.
Emerging nations should continue to carry world growth in 2007, but European economies are likely to take a growing share of the burden, according to the ECB chief. Trichet said there were signs of a 'very clear pick-up' in investment in Europe.
