French President Nicolas Sarkozy angered EU finance ministers and central bank governors, gathered at an informal meeting in Porto on 14-15 September to discuss recent economic and financial developments, after he renewed his attacks on the ECB's monetary policy and questioned its actions to stem off the recent financial turmoil.
In comments to the press on 15 September, Sarkozy said he thought it "curious" that the Bank had injected large amounts of liquidity onto the markets without cutting interest rates, adding that such a policy was sure to benefit speculators while making life harder for entrepreneurs.
But France found herself isolated among her European partners, which not only stressed the ECB's independence and backed its handling of the financial crisis, but also turned against France, demanding that it concentrate on its own economic weaknesses.
Indeed, France's budgetary situation was one of the issues on the table during the meeting, with French Finance Minister Christine Lagarde presenting her country's stability programme to her fellow eurozone ministers, amid concerns that her reform proposals risk raising the French budget deficit to unacceptable levels.
Despite downward growth forecasts for France by the Commission and the Organisation for Economic Cooperation and Development (OECD), Lagarde stuck to an earlier plan, presented in July by Sarkozy, to cut France's budget deficit from 2.5% in 2006 to 2.4% in 2007.
Finance Commissioner Joaquín Almunia and the EU's 'Mr Euro', Luxembourg Prime Minister Jean-Claude Juncker, said that France would have to "considerably step up its efforts" if it is to eliminate its public debt by 2010, as promised by former president Jacques Chirac.
But Sarkozy said that sluggish growth in the French economy meant he is unlikely to fulfill this promise before 2012.
The Portugal talks concluded that, despite the current financial market volatility, solid macro-economic fundamentals in the EU meant that prospects for growth remain strong. Ministers recommended a review of current financial-market regulations, although they stressed there would be no rush to impose new rules on credit-rating agencies and banks.
