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(CEP News) - Speaking in Washington, D.C. before the G7 conference, Bank of France Governor Christian Noyer said that markets need to accept that liquidity measures will take time and that they can't keep asking for a new rescue package if results are not immediate.
"If we we continue like this we'll never stop," said Noyer, adding that the banks will get unlimited liquidity until January 2009. He noted that the disharmony in money markets threatens growth. Noyer also gave his assurance that the ECB will meet all banks' liquidity needs. Noyer expects inflation to drop below 2% in mid-2009. He said lowered inflation expectations have altered the outlook on prices, and that the ECB should keep a watchful eye to ensure that second-round effects do not take hold in the economy. Noyer repeated ECB President Jean Claude Trichet's previous message to markets to "collect themselves." By Steve Stecyk,
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