European Central Bank President Jean-Claude Trichet said on Sunday he did not believe Europe was facing recession and renewed his support for reforms and deficit cuts to boost confidence.
Plans to stress test European banks would also be an important element in restoring market confidence, Trichet told reporters on the sidelines of an economic conference in Aix-en-Provence.
(For) durable growth that is sustainable in the long term, then you must strengthen confidence, and that means having budgetary policies that are balanced and sustainable in the eyes of everyone, Trichet said.
Government austerity drives and deficit cuts would not choke growth but rather restore confidence, he added, reiterating his opposition to Europe-wide debt issuance to spur growth.
When asked whether he thought Europe was facing another period of recession, Trichet said: I do not believe this at all.
At the global level it is clear that we are experiencing a recovery which is confirmed particularly in the emerging world but also in the industrialized world
(Reporting by Lionel Laurent, Jean-Baptiste Vey and Matthias Blamont, Editing by Marcel Michelson)