OECD: U.S. Federal Reserve should continue to raise interest rates but the European Central Bank and Bank of Japan rate hike should be postponed.

<P Align=left> </ P> <P> OECD29 said Wednesday, as rising inflation and higher oil prices within the next two years may lead to increased wage demands, the Fed should continue to raise interest rates, but the European Central Bank and Bank of Japan Bank should delay .interest rates to promote economic growth. .</ P> <P> YORK, Nov. 29 report, the OECD (OECD) 29 at its semi-annual economic outlook report that, due to rising inflation and higher oil prices within the next two years may lead to wage demands .rise, the Fed should continue to raise interest rates to raise interest rates to a neutral level or higher level restricted. .But the European Central Bank (ECB) and Bank of Japan rate hike should be postponed, due to inflation and sluggish economic recovery has just begun. .</ P> <P> OECD believes that the need to avoid early ECB rate hike should be to gradually raise the time comes, it is best to raise interest rates later in 2006. .The Bank of Japan should stick to quantitative easing policy until inflation reaches 1%, to four and a half to end its zero interest rate policy. .</ P> <P> OECD predicts that by the end of March 2006, the U.S. federal funds rate from the current 4.25% to 4.75%. .The Bank of Japan, in 2006 to maintain zero real interest rate policy will continue to raise interest rates before the end of 2007 to 1%. .</ P> <P> aspects of the Group of Seven countries, OECD says Canada because of full economic recovery should continue to raise its current 3% interest rate, expected at the end of 2007 the Bank of Canada will raise interest rates to 4.25%. .The Bank of England, OECD believes that the Bank of England cut interest rates in August to 4.5% in the environment is no longer necessary to cut interest rates again, the UK interest rates should maintain the status quo. .</ P> <P> the current interest rate futures trading shows investors expect the Fed12 the 13th consecutive monthly hike. .Investors also expect the European Central Bank (ECB) will be Dec. 1 the first time in five years, interest rates, because the European Central Bank President Jean-Claude Trichet (Trichet) and other officials are worried about inflation out of control. .</ P> <P> Bank of Japan Governor Toshihiko Fukui (ToshihikoFukui) on November 18 that Japan's policies may change in the 06 fiscal year. .06 fiscal year began April 1, 2006. .</ P> <P> OECD chief economist Curtis (Jean-PhilippeCotis) in the 234 citations in the report, said the situation continued expansion of the global economy appears to be true. .Global economic growth has been gradually expanding. .</ P> <P> to coordinate economic policy and analysis for the purpose of the OECD said that 31% of the face of soaring oil prices, global economy is expected to appear earlier than the OECD also have vitality. .This allows the OECD to improve its growth prospects in Japan and Europe point of view. .OECD said that the global economy has weathered the relative impact of energy prices. .</ P> <P> but the OECD also said the global economy still faces considerable risks, including: oil prices will remain high, the organization may not be dropped to 07 by the end of the expected price will be maintained - .51 dollars per barrel. .At the same time, housing prices in some countries and bond prices could collapse, investors may also be due to the U.S. current account deficit and fear. .The U.S. current account deficit in 2006 will account for gross domestic product (GDP) 7%. .</ P> <P> OECD Governments were requested to reduce the budget deficit and prepare for the population decline and increase the retirement preparation. .OECD says governments should seriously promote a long way to reach the public finances. .</ P> <P> China is not the OECD Member States, but the OECD has said that the economic importance of China to the world it is necessary to be mentioned, and called on China to revalue its currency. .OECD expects China's 2005 economy to grow 9.3% in 2006 to grow by 9.4%. </ P>.