ECB's Rehn warns against excessive energy expenditure
HELSINKI, Sept 29 (Reuters) - Euro area countries should avoid increasing spending too much due to the energy crisis as long-term debt already poses a threat in one-third of the bloc, European Central Bank policymaker and Finnish central bank chief Olli Rehn said on Thursday.
"The efforts of EU countries to identify ways to limit household energy bills are understandable but indiscriminately increasing expenditure would not be - and would not help in the fight against inflation," Rehn said in a statement.
Instead, he called for tailored and temporary measures targeted at the most vulnerable to help them pay for their energy.
"The long-term debt sustainability of more than one-third of the countries in the euro area is under serious threat," he said.
Rehn said Europe should combine its forces in combating energy-related inflation via energy market reforms but first and foremost by saving energy.
"There are some encouraging signs that the market economy is to some extent working in the sense that we see higher energy prices affecting demand," Rehn said, citing statistics from Finland showing that the use of natural gas has halved this year thanks to energy saving by industrial users.
Reporting by Anne Kauranen; Editing by Balazs Koranyi and Hugh Lawson
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.