WRITTEN QUESTION E-0755/04 by José García-Margallo y Marfil (PPE-DE) to the Commission. Statistics relating to the harmonised consumer price index in Europe.
Date: 2004-03-11
Institutions: European Parliament, Provisional data
Subjects: EU statistics, consumer behaviour, consumer price, euro, euro area, household consumption, image, inflation, price index

3.4.2004

EN

Official Journal of the European Union

C 84 E/871

Answer given by Mr Bolkestein on behalf of the Commission

(16 April 2004)

Regarding Parliament’s vote on the report by Mr Purvis on hedge funds, Mr Margallo would like to know
what follow-up action the Commission is planning, particularly on the possibility of establishing a
European legal framework to regulate such funds.

The Commission would first remind the Honourable Member that, at their informal meeting in Oviedo in
April 2002, the Economics and Finance Ministers undertook to examine the role played by hedge funds.
This undertaking formed part of a raft of measures taken in the wake of the Enron scandal.

At the same time, several initiatives were launched at international level in this connection, including by
the Financial Stability Forum (FSF), the International Organisation of Securities Commissions (IOSCO) and
national regulators such as the US Securities and Exchange Commission.

The report by Mr Purvis represents a major contribution in this respect. It should also be borne in mind
that the Commission’s Internal Market Directorate-General set up in October 2003 four professional expert
working groups to examine, among other things, the strategic priorities for the work to be undertaken by
the Commission in the years ahead. One of
the groups has been charged with examining asset
management while another will
look into securities issues. The Commission will, of course, take into
account the groups’ conclusions, which will be published by the end of April and then opened for public
consultation between May and July. A high-level conference will be held on 22/23 June. It is only after the
results of the public consultation and the conclusions of the high-level conference have been analysed that
the Commission will take an official position on the subject of derivatives and alternative investment funds.

(2004/C 84 E/0964)

WRITTEN QUESTION E-0755/04

by José García-Margallo y Marfil (PPE-DE) to the Commission

(11 March 2004)

Subject: Statistics relating to the harmonised consumer price index in Europe

The harmonised consumer price index used by Eurostat is a benchmark for comparing inflation between
Member States but, without casting doubt on its highly sophisticated scientific nature, how does the
Commission explain the persistent feeling among the public in the euro zone that price rises far exceed the
increase recorded by the harmonised consumer price index?

Does the Commission realise that, if it cannot be changed, this public perception will have particularly
negative effects as it
inflationary factors have very important psycho-
sociological interactions and that the fall or stagnation in household consumption can partly be explained
by this perception, which may well be mistaken, but which demands a convincing response?

is common knowledge that

Answer given by Mr Solbes Mira on behalf of the Commission

(15 April 2004)

The Commission has noted the discrepancy between price increases recorded by official statistics such as
the Harmonised Index of Consumer Prices (HICP) and measures of perceived inflation in several Member
States. There are various possible explanations for such discrepancy. One that has received supportive
evidence (see for example Eurostat’s June 2003 HICP press release) is related to the fact that, following the
euro cash changeover, consumers experienced significant price increases for some types of goods and

C 84 E/872

Official Journal of the European Union

EN

3.4.2004

services, mostly small services and some frequently bought items. These goods tend to have a large impact
on how the public perceives price developments, whereas, due to their relatively small weight in the
overall basket of consumption measured by Consumer Price Indices, their price increases were offset by
more moderate price developments in other categories of goods and services.

The Commission is fully aware of the possible macroeconomic risks that might stem from the mismatch
between inflation perceptions and recorded inflation. However, the Commission also notes that other more
fundamental elements are generally advanced as having a stronger bearing on the behaviour of private
consumption expenditure. These include changes in unemployment levels, in wages, in asset prices and in
the fiscal stance of Member States. Hence, on the basis of available economic evidence it appears unlikely
that the discrepancy between recorded and perceived inflation would be a major element behind the recent
behaviour of private consumption in the euro area.

(2004/C 84 E/0965)

WRITTEN QUESTION E-0757/04

by José García-Margallo y Marfil (PPE-DE) to the Commission

(11 March 2004)

Subject: Strengthening the role of market operators in the integration of European financial markets

The Lamfalussy process has brought about significantly greater participation of
professionals in drafting the relevant European legislation, with every positive outcome.

financial services

However, there still needs to be more effective coordination of market operators because although market
integration obviously requires legislation it also relies on the harmonisation of national market practices
and greater standardisation of products.

Should the Commission not encourage the establishment of such rules at European level, along the lines of
the EONIA (Euro OverNight Index Average)?

Answer given by Mr Bolkestein on behalf of the Commission

(16 April 2004)

The Commission welcomes the fact that the Honourable Member shares its view regarding the beneficial
effects of the Lamfalussy process. It agrees with its analysis as to the greater positive participation of
financial services professionals in drafting the relevant European legislation.

Alongside the planned legal framework for drafting Community legislation, the Commission is generally
amenable to any initiative designed to strengthen the integration of European financial markets and to
promote their growth and further development. Accordingly, an independent bank initiative such as that
establishing a reference rate for markets along the lines of the EONIA is altogether positive and deserves
support.

In May 2004 the European financial services market will certainly need more European indices as well as
agreements and even standards for certain products (cid:1) a task in which market participants could take the
lead.