The International Monetary Fund has claimed that the monetary policy across the euro ruled area has the potential to remain moderately accommodative and said that the European Central Bank has time to hold the borrowing costs as the euro region economy gathers strength.
 
On 5th May, the ECB President, Jean-Claude Trichet, hinted that the Central Bank may carry on the benchmark at 1.25% soon after an increase in the borrowing costs to fight the price pressure, may be for the first time. On the other hand the price rise was observed speedy with 2.8% during the April, in euro-reigns.
 
The IMF said: “Strong policy responses have successfully contained the sovereign-debt and financial-sector troubles in the euro-area periphery so far, but contagion to the core euro area, and then onward to emerging Europe, remains a tangible downside risks”.
 
Further, the IMF has also hailed on the European Central Bank to avoid any further increase in the interest rates while urged the EU along with its member states to support the banks which require huge cash aids against another recession.
 
It has forecasted that the 17 member euro regions will enjoy the economic growth of 1.7% this year and around 1.9% during 2012.