FRANKFURT Germany AP With economic growth faltering the core council of Europe's future central bank meets Tuesday under increasing pressure to spell out its policies before launching the euro currency on Jan. 1. The European Central Bank begins setting monetary policy including interest rates for the 11 euro nations as soon as the currency is launched. Analysts say the bank has a tough job ahead with Europe's economy weakened by lower demand in Asia for a range of goods and services and by Russia's financial crisis. Manufacturing orders are down. If prices begin to sink as growth falls then recession is possible some analysts believe. ``It's a much more difficult situation than we all thought some time ago. Inflation is certainly no problem. Right now everybody is very much afraid of deflation'' said Adolf Rosenstock economist at Nomura. Europe's new interest rate will be a key issue in the closed-door talks. The rate is likely to be at or near Germany's 3.3 percent though there is speculation it could drop to 3 percent. Although the bank is independent it has come under steady political pressure from Germany to keep interest rates low to boost economies and help governments cut unemployment standing Europe-wide at 9.9 percent. The bank says its job is to keep inflation low and prices steady not to tinker with monetary policy to achieve broader economic goals. But pressure only grew Tuesday as leaders of Germany and France agreed to strengthen efforts to fight unemployment and boost the economy. Another major issue is how the central bank will assess money supply a key element in deciding future interest rate policy. The governing council of the European Central Bank consists of 11 central bank chiefs from the European Union countries launching the euro plus a Frankfurt-based directorate of six that includes bank President Wim Duisenberg. dkt-aet APW19981201.1042.txt.body.html APW19981201.1500.txt.body.html