FRANKFURT The deputy president of the Bundesbank, Juergen Stark, said in a newspaper interview Wednesday that policymakers needed to keep a cool head in face of the global slowdown and should not act overhastily.

"In the current global economic situation, you should be careful not to contribute further to nervousness or panic to the markets, or take any overhasty political action," Stark told the financial daily ***Boersen-Zeitung****.

"Rather, you should keep a cool head and send confidence-building signals to the general public."

Stark did not specify whether he was also referring to monetary policy makers, but the European Central Bank is coming under mounting pressure to cut key interest rates to boost the flagging European economy.

The ECB was meeting Wednesday to set interest rates for the 12-country euro area and the outcome of the meeting was expected to be a close call, with no consensus in favor of a rate cut apparent on the bank's governing council.

According to an AFP report, the ECB is the only major Central Bank in world not to have cut its key rates in face of the sharp deterioration in global economic conditions.

But Stark argued that Europe was in a different situation to the United States and Japan, where both the U.S. Federal Reserve and the Bank of Japan have recently cut their rates.

Indeed, European interest rates were still relatively low and even though the U.S. Federal Reserve has cut 1.5 percentage points off interest rates since the beginning of the year, U.S. rates were still higher than those in Europe.

"In view of the differing situations in the euro area, the U.S. and Japan, you can't set in motion the same monetary policy strategy and the same mechanisms for setting interest rates in all three monetary areas," Stark said.