REUTERS: Global interest rates must rise to avoid high inflation becoming entrenched, the Bank for International Settlements said on Sunday.
It also warned that delaying deficit cuts could risk intensifying the sovereign debt crisis and have grave consequences were investors to lose confidence in a major economy such as the United States.
"With the arrival of sharper price increases for food, energy and other commodities, inflation has become a global concern," the BIS said in its annual report.
"Tighter global monetary policy is needed in order to contain inflation pressures and ward off financial stability risks."
Of the four major central banks, the European Central Bank is the only one which has raised rates since the intensification of the financial crisis in late 2008. » | Sakari Suoninen | BASEL, Switzerland | Sunday, June 26, 2011
