G10 Trichet-Global growth encouraging, mkts coping

BASEL, Switzerland, Mar 13 (Reuters) Global growth is encouraging and financial markets have coped well with recent policy changes by major central banks, Jean-Claude Trichet, chairman of the G10 group of central bankers, said on Monday.

Japan's decision last week to scrap its ultra-easy monetary policy and stop flooding markets with cheap cash had been well-communicated, Trichet told a news conference.

''All taken into account, we could say that global financial markets had absorbed all this information quite well,'' Trichet said after meetings at the Bank for International Settlements.

Trichet said the outlook for global growth was stable and there had so far been no signs of high oil prices feeding into higher consumer price inflation and wages.

''Global growth is there, and I would say encouraging, as has been the case in our previous meeting,'' he said, listing global imbalances, protectionism, oil prices and the under-assessment of risks as possible threats to the outlook.

He said real estate markets needed close monitoring but there were not ''any reasons to be alarmed'' at present.

Investors now believe the Bank of Japan seems likely to join the U.S. Federal Reserve and the European Central Bank in raising interest rates, although it has given no signs of when this could occur.

The ECB raised rates in December for the first time in five years, and followed that with another hike in March, while the Fed seems set to continue its gradual tightening process.

The BOJ said it would start to guide short-term interest rates rather than flooding markets with excess funds and would also adopt an inflation reference rate of zero to 2 per cent.

Trichet, who is also President of the European Central Bank, was addressing a news conference after central bankers from the Group of 10 nations met in the Swiss city of Basel.

REUTERS SD DB1817